Boyaa Interactive International Ltd. (0434.HK), originally a gaming company known for its Texas Hold'em games, is undergoing a significant transformation as it leans into the Web3 gaming space, heavily influenced by its bitcoin holdings. The company reported a staggering 110-120% increase in losses for the first quarter of 2023, primarily due to falling bitcoin prices, which have adversely affected its balance sheet. Boyaa's net loss reached HK$239 million ($30.5 million) last year, and its bitcoin holdings, totaling 4,092 bitcoins, were acquired at an average price of about $68,000 each.

Despite the losses, Boyaa's core profits rose by 85-90% year-on-year, indicating a shift towards targeting higher-spending users rather than relying on user growth. The company is deploying part of its bitcoin holdings into Web3 initiatives, including using 1,000 bitcoins for blockchain security and 500 bitcoins for liquidity in its YAAKO Wallet. However, the decline in user numbers—34.5% drop in monthly active users and a 54.7% drop in paying users—poses risks to its revenue stability. Currently, Boyaa's shares have fallen by 42% over the past year, reflecting investor caution towards its volatile crypto strategy amidst a cooling crypto market.