MemeStrategy, Inc. Announces World’s First Tokenized Pokémon Trading Card Fund

Key Insights for Investors

• Launch of Groundbreaking Fund: MemeStrategy, Inc. (Stock Code: 2440) has announced the formation of the world’s first tokenized Pokémon trading card fund, named Trading Card Fund I (Pikachu With Grey Felt Hat) LPF (“the Fund”). This fund exclusively targets PSA 10-graded “Pikachu with Grey Felt Hat” cards, a rare and highly sought-after collectible from the Pokémon x Van Gogh Museum collaboration.
• Innovative Tokenization Structure: EVIDENT, expected to be the first limited partner, will tokenize its partnership interest in the Fund. These digital tokens will grant professional investors economic exposure to the Fund’s performance, with secondary trading available on a licensed alternative asset digital investment platform operated by EVIDENT.
• Strategic Expansion into Blockchain and Real-World Assets: The initiative forms a core part of MemeStrategy’s strategy to extend beyond data management into blockchain-based solutions and real-world asset (RWA) applications, particularly in the cultural and intellectual property segment.
• Potential Participation by MemeStrategy: The company may indirectly gain economic exposure to the Fund by purchasing tokens on the platform, rather than investing directly as a limited partner. This approach is expected to provide greater liquidity and flexibility.
• Regulatory and Accounting Clarity: The Fund’s assets are classified as physical collectibles and do not constitute “securities” under Hong Kong law. MemeStrategy, its group, and the Fund do not require any securities license for the operation of the Fund. The company will continue reassessing control and accounting implications based on capital movements and investments.

Full Details for Shareholders and Potential Price-Sensitive Developments

1. Fund Structure and Operation

The Fund is structured as an open-ended limited partnership, managed exclusively by RWA Labs Limited, a wholly-owned subsidiary of MemeStrategy. RWA Labs will oversee all aspects of fund management, including asset acquisition, divestment, and general business affairs. Notably, the Fund’s target assets are restricted to PSA 10 “Pikachu with Grey Felt Hat” cards, enhancing focus and potential scarcity value.

MemeStrategy has clarified that it does not currently intend to participate as a limited partner, but reserves the right to gain exposure through token purchases.

2. Tokenization Process and Platform

Tokenization is exclusive to EVIDENT’s limited partnership interest. EVIDENT will mint and issue digital tokens that reference its partnership stake, offering investors indirect economic exposure and certain limited contractual rights. These tokens will be sold to “professional investors” as defined under Hong Kong regulations, and traded on EVIDENT’s licensed digital asset platform.

Importantly, the Fund itself, MemeStrategy, and its subsidiaries are not involved in the tokenization process, which isolates them from direct regulatory risks tied to token creation and trading.

3. Legal, Regulatory, and Accounting Considerations

As the cards are classified as physical collectibles rather than securities, the Fund and MemeStrategy avoid the need for SFO regulatory licenses. The company assures compliance with all relevant legal frameworks for fund operation.

From an accounting perspective, ongoing assessments with auditors will determine whether the Fund’s assets and liabilities are consolidated into MemeStrategy’s financial statements. Any future changes in fund subscriptions, withdrawals, or trading card transactions may affect consolidation and could result in reportable acquisitions or disposals under Hong Kong Listing Rules.

4. Comparison: Direct Investment vs. Token Purchase

For investors, MemeStrategy has performed a thorough comparison between investing as a limited partner and acquiring tokens:

• Nature of Rights: Limited partners possess direct economic, voting, and information rights, while token holders have only indirect, contractual rights via EVIDENT’s platform.
• Economic Exposure: Both routes provide similar economic benefits, but token holders’ returns are subject to deductions for platform fees.
• Liquidity: Limited partners face significant redemption restrictions, while tokens offer secondary market liquidity via the platform.
• Fees: Both are subject to fund-level fees, but tokens may incur additional platform and transaction costs.
• Risk Profile: Tokens introduce additional counterparty and platform-related risks, but MemeStrategy’s due diligence found these risks to be mitigated by regulatory status (SFC-licensed platform) and segregation of EVIDENT’s assets.

The Board ultimately prefers the flexibility and potential liquidity of token purchases, considering these advantages to outweigh the additional platform fees and risks.

5. Strategic Business Implications

This initiative aligns with MemeStrategy’s previously announced strategy to leverage its core data management expertise in the blockchain and RWA domain. The Fund’s requirement for IoT-enabled vaults for card storage, verification, and data management dovetails with MemeStrategy’s capabilities. The tokenization of real-world assets, such as rare Pokémon cards, represents an innovative step in combining physical collectibles with blockchain technology.

The company’s participation in token markets also signals strategic support for RWA tokenization, which may enhance its market profile and appeal to tech-forward investors.

Conclusion: Potential Share Price Impact

This announcement contains potentially price-sensitive developments for MemeStrategy, Inc. shareholders:

• The company’s pioneering move into tokenized real-world assets and expansion into blockchain-enabled solutions could position it as a leader in an emerging niche, potentially attracting greater investor attention and market re-rating.
• The liquidity and flexibility gained through token exposure could positively affect MemeStrategy’s capital management and risk profile.
• The company’s commitment to regulatory compliance and risk mitigation may increase investor confidence.

Investors should closely monitor further updates on fund subscriptions, token trading volumes, and any changes to consolidation status or major asset transactions, as these could have significant implications on financial statements and share price.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or an offer to buy or sell any securities. Investors should conduct their own due diligence and consult professional advisors before making investment decisions. The Fund referenced herein is available only to professional investors and has not been authorized by the SFC. MemeStrategy, Inc. and the Fund are subject to various risks, including those related to collectibles, blockchain technology, and platform operations.

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