Hong Kong regulators have effectively halted five listed companies from transitioning into digital asset treasuries. This decision stems from fears of inflated stock valuations and potential investor protection issues, highlighting Hong Kong’s cautious approach to the rise of crypto-related investments in the financial market. Facing scrutiny over inflated share prices exceeding their actual underlying crypto holdings, companies seeking to transform into crypto-focused treasury models are facing regulatory pushback. The Securities and Futures Commission is actively reviewing applications from firms intending to move towards these strategies, with authorities raising concerns about potential manipulation of the stock market by such ventures.