What happened?
On August 13, Dafeng Electric publicly announced that it has become the first listed company in Taiwan to include Bitcoin in its long-term reserve assets. This move immediately received a positive market response, propelling its stock price to hit the daily limit on the first trading day after the announcement (August 14).
In response to global inflationary pressures, Dafeng Electric emulated the approach of MicroStrategy in the United States, converting part of its cash assets into Bitcoin, which is regarded as “digital gold,” to combat the depreciation of fiat currency purchasing power and seek diversification of assets.
Taiwan’s First Case! Dafeng Electric Bets on Bitcoin, Stock Price Soars to Limit
A historic moment has arrived in Taiwan’s capital market. Dafeng Electric (6184), a cable television and broadband service provider, dropped a bombshell on the evening of August 13, announcing its decision to incorporate Bitcoin into the company’s long-term asset reserves, becoming the first publicly listed company in Taiwan to embrace cryptocurrency.
As soon as the Taiwan stock market opened on August 14, Dafeng Electric’s stock price jumped to the limit, locking in at NT$56.1, with over 2,000 buy orders lined up waiting to enter the market.
Faced with ongoing global inflation pressures and an unstable interest rate environment, companies holding cash face the risk of declining purchasing power. According to a report from the Economic Daily News, Dafeng Electric’s board of directors resolved to convert part of its cash assets into Bitcoin, aiming to diversify risks in a volatile economic landscape. They noted that Bitcoin, with its fixed supply, decentralized nature, and high global liquidity, acts as a new generation of “digital gold,” providing greater stability and flexibility for the company’s capital.
To ensure the robust execution of this strategy, Dafeng Electric also announced the establishment of a “Digital Asset Committee.” This committee, chaired by director Dai Yonghui, integrates the company’s core departments of risk management, legal affairs, cybersecurity, and strategy, formulating rigorous asset allocation principles, risk control mechanisms, and information disclosure regulations to ensure that the decision-making process complies with regulations and protects shareholder interests.
The company spokesperson emphasized, “Incorporating Bitcoin into long-term assets is an important step for us to embrace the wave of the digital economy.” He also stated that this investment will be completely segregated from daily operating funds, ensuring that its core cable television and broadband businesses remain unaffected, and that the company will adhere to a “stability first” principle, adopting a prudent, phased strategy for implementation.
Upon this announcement, capital market attention surged. Investors generally view this decision as a demonstration effect, anticipating that it may prompt other listed companies in Taiwan to follow suit and explore the potential of digital asset management.
The optimistic sentiment in the market was directly reflected in stock performance. As soon as the Taiwan stock market opened on August 14, Dafeng Electric’s stock price surged by NT$5.1, reaching the limit price of NT$56.1, accompanied by over two thousand pending buy orders.
Who is Dafeng Electric?
Dafeng Electric, fully named Dafeng Cable Television Co., Ltd., is a major cable television and broadband service provider in Taiwan. Founded in 1996, the company primarily operates in New Taipei City, offering cable television services to residents in areas such as Banqiao, Tucheng, and Zhonghe, making it one of the largest cable television system operators in New Taipei City.
In addition to traditional television channel content, Dafeng Electric has actively developed its broadband internet business in recent years, competing in the market under the brand “Dada Broadband,” which it views as the core of future operational growth.
Alongside this innovative financial operation announcement, Dafeng Electric also reported its operational performance. In the first half of this year, consolidated revenue reached NT$1.08 billion, with a net profit attributable to the parent company of NT$262 million, a year-on-year increase of 4.8%. Among these figures, broadband business revenue contributed NT$440 million, accounting for 40.7% of consolidated revenue, representing a growth of 12.8% compared to the same period last year.
Dafeng Electric’s chairman, Zhang Mingzhi, stated that despite the declining trend in total cable television households in Taiwan, the company would continue to strive to maintain and provide quality channel content. However, the future development focus will undoubtedly be on broadband services. The number of users for “Dada Broadband” has reached 179,000 in the first half of this year, with a net increase of over 5,000 users.
Additionally, Dafeng Electric is steadily advancing the initial public offering (IPO) plan for its subsidiary “Dada Broadband,” having recently completed NT$1.8 billion in cash capital increase and is preparing for a second capital increase, aiming to inject stronger momentum for future market expansion.
Dafeng Electric Emulates MicroStrategy, Opening a New Chapter in Asset Management
Dafeng Electric’s decision to include Bitcoin in its reserve assets largely replicates the approach of the U.S. listed company MicroStrategy (later renamed Strategy). Since 2020, MicroStrategy has made unprecedented large-scale purchases of Bitcoin as its primary inventory asset, positioning itself as a Bitcoin concept stock, with its stock price highly correlated to Bitcoin’s fluctuations.
As the first publicly listed company in Taiwan to incorporate cryptocurrency into its financial strategy, Dafeng Electric plays the role of a “pioneer.” The immediate stock price surge following its announcement undoubtedly attracts the attention of other companies that are still observing. If this move brings sustained positive benefits to Dafeng Electric, it could trigger a wave of imitation, prompting more companies to begin researching and even allocating digital assets.
Simultaneously, as companies begin to venture into digital assets, existing accounting standards, tax regulations, and information disclosure requirements will face challenges. Regulatory authorities (the Financial Supervisory Commission) will inevitably need to accelerate the development of relevant supervisory frameworks to ensure market transparency and investor protection. Dafeng Electric’s case will serve as a crucial stress test to push Taiwan’s regulatory framework to keep pace with the times.
In the future, when investors evaluate companies like Dafeng Electric, they must consider not only traditional operational indicators such as business operations, revenue, and profit but also the cryptocurrency holdings and their value fluctuations, adding a new dimension to stock market analysis. Investors must also possess a basic understanding of the cryptocurrency market to assess its potential impact on the company’s financial statements and stock prices.