Chinese crypto founders shelve US$500 million ether digital asset treasury project

Core Viewpoint - The cancellation of a US$500 million ether digital asset treasury project reflects the ongoing struggles within the cryptocurrency market, which has not yet recovered from recent downturns [1][5]. Group 1: Project Details - The ether digital asset treasury (DAT) project was initiated by notable figures in the cryptocurrency space, including Huobi founder Leon Li Lin and HashKey Group chairman Xiao Feng, with the goal of raising US$500 million to invest in ether [2]. - The project had already secured US$110 million in capital commitments before being shelved due to worsening market conditions [2]. Group 2: Market Conditions - The cryptocurrency market has experienced significant volatility, with bitcoin dropping more than 30% from its peak earlier this year, falling below US$90,000 [5][6]. - The broader market slump has led to the liquidation of over a million traders and the loss of approximately US$19 billion in leveraged bets [5]. Group 3: Regulatory Environment - DAT companies, which are publicly listed firms that hold large amounts of cryptocurrencies, have gained popularity in the US but have not been well-received by regulators in Hong Kong [4]. Group 4: Investor Sentiment - Leon Li expressed concerns about the unclear macroeconomic outlook and the poor performance of the market during a recent investor event, leading to the decision to delay the ether DAT project to prevent investor losses [7].