In 2021, Meitu splurged $100 million to rush into the crypto market, investing heavily in Bitcoin and Ethereum.

Three years later, cashing out $570 million, the management, who should have been toasting, lamented 'regret' at the earnings conference.

Why did this textbook-level profitable investment make companies eager to distance themselves from cryptocurrencies?

I. A seemingly easy business hides a fatal cost.

Meitu's cryptocurrency trading results are impressive, but behind the glamorous numbers is a serious imbalance in corporate development.

  • Misallocation of energy:


    Executives closely watch K-line trends daily, while the AI R&D team is forced to slow down due to resource shortages.

  • Trust Crisis:

    The Hong Kong Securities and Futures Commission has sent three letters inquiring, and the capital market begins to question whether 'the photo editing software company has become a cryptocurrency trading machine.'

  • Strategic Misplacement:

    During the critical period of the generative AI explosion, Meitu missed the opportunity due to scattered energy and was outpaced by competitors.

This dilemma of 'making quick money while losing the future' is a microcosm of many cross-industry crypto investment companies. The high volatility of the crypto market naturally conflicts with the stable development logic of traditional enterprises; the attention distraction brought by short-term exorbitant profits may cost companies greater strategic price.

II. Behind the Liquidation: Reassessing the Strategic Value of Crypto Investment

In 2024, Meitu decisively liquidated its holdings and turned to collaborate with Alibaba on a $250 million deep dive into AI imaging. This abrupt shift releases three major signals:

  • Focus on core business: Abandon short-term speculation and return to the original field of using technology to help users enhance their beauty.

  • Recognize boundaries: Acknowledge that the crypto market is not your home ground, and focus on areas that can build a moat.

  • Rebuild trust: After a timely exit, ESG ratings soared, regaining investor recognition.

This also confirms a fact:

For non-native crypto companies, trading cryptocurrencies is more like a zero-sum game — even if there are paper profits, it may consume the growth potential of core business.

III. Insights for the Crypto Circle: The Game of Speculation and Value

Meitu's experience does not negate the value of crypto investment but reveals three key lessons:

1. The Law of Capability Circle: The threshold for blockchain technology is beyond imagination; blind cross-industry ventures may result in losses.

2. Long-termism: Beware of the temptation of exorbitant profits; core competitiveness is fundamental for companies to navigate cycles.

3. Compliance First: In the current environment of tightening regulation, non-compliant profits will ultimately come at a cost.

True opportunities do not lie in short-term speculation, but in exploring the deep integration of blockchain technology with core business.

As Wu Xinhong reflects: Instead of chasing price fluctuations, companies should invest resources in innovations that can generate real value. This game of value and choice is worth pondering for every practitioner in the crypto field.