Animoca backs GROW Digital Wealth in Hong Kong pivot
Animoca Brands has agreed a term sheet with GROW Investment Group for a strategic partnership and an equity investment in GROW Asset Management (HK), which plans to rename itself GROW Digital Wealth.
The parties said Animoca Brands intends to acquire up to 15% of the Hong Kong-based unit, subject to definitive agreements and any required approvals. The investment size was not disclosed.
GROW described itself as a China-focused investment and asset management platform backed by Julius Baer. The partnership centres on GROW Digital Wealth, which the companies described as GROW's flagship platform.
Platform plans
The companies said they plan to build GROW Digital Wealth into a platform in Asia that offers both crypto and traditional finance investment products for family offices and ultra-high-net-worth individuals. They also set out a role for independent financial advisers in distributing those products.
GROW Digital Wealth operates under Hong Kong regulation. The business holds Type 1, Type 4 and Type 9 licences issued by the Hong Kong Securities and Futures Commission. Those licences cover dealing in securities, advising on securities and asset management.
Animoca Brands said it plans to introduce crypto assets to the platform. It said the scope includes real world assets. GROW said it will bring its curated investment products to the platform.
The parties said independent financial advisers will be able to offer clients both crypto and traditional finance products through the platform. They framed the proposition around regulated distribution and an operating system for advisers.
China wealth
The companies linked the partnership to changes in the China wealth market and demand for overseas investment options. They cited a figure of more than 3 million high-net-worth individuals in China with investable assets exceeding CNY127 trillion, which they equated to approximately USD $18 trillion.
They said investors have been diversifying away from traditional onshore assets into overseas investments and alternative products in search of higher returns.
Hong Kong has increased its focus on regulated digital asset activity in recent years, with policy initiatives and licensing regimes that cover virtual asset trading platforms and related services. Animoca Brands referenced the territory's position in its comments on the partnership.
"Hong Kong is emerging as an important hub for regulated digital asset activity in Asia. By partnering with GROW, we aim to connect our Web3 and RWA initiatives with a licensed wealth management platform to further expand access to digital assets. Together we intend to explore compliant, technology‐driven ways to bring new asset classes and structures to family offices and independent advisors in the region," said Alan Lau, Chief Business Officer, Animoca Brands.
Education focus
The companies also plan education initiatives focused on the convergence of traditional and decentralised finance. They did not provide details of content, delivery partners, or a timetable.
GROW's Founding Partner and Global Chief Investment Officer, William Ma, said he expects structural change in wealth management from technology-led shifts.
"We believe the world of wealth management is on the cusp of drastic change with decentralization and disintermediation being two disruptive powerful forces. The successful wealth management models of the near future will be those that combine the best of both traditional and digital offerings, with the strongest alignment of interest to clients by technology. We are excited to have the opportunity to work with a global leader - Animoca Brands - on this exciting venture," said Ma.
The companies said they expect the partnership work on GROW Digital Wealth to proceed alongside negotiations on definitive documentation and any regulatory or other approvals tied to the proposed equity stake.