Chinese blockchain investor revamps business plan towards industrial cannabis, in wake of bitcoin rout

Grandshores Technology, partially backed by the Hangzhou municipality, is diversifying towards medicinal and industrial cannabis cultivation

The company said it plans to buy a 40 per cent stake in Hangzhou Yupu Trading, which has access to seeds and growing rights for industrial hemp

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A worker inspects cannabis plants growing inside a shipping container grow pod at the Delta 9 Cannabis Inc. facility in Winnipeg, Manitoba on September 25, 2018. Photo: Bloomberg

Published: 2:23pm, 2 May 2019Updated: 9:28pm, 2 May 2019

Grandshores Technology, the Hong Kong-listed blockchain investor backed by the government of Hangzhou municipality, is diversifying into medicinal and industrial cannabis cultivation as it embarks on a new business strategy to counter a lethargic bitcoin market.

Co-chairman Yao Yongjie told the South China Morning Post that the company will decide next year whether industrial cannabis planting would become the company’s new business focus, and divert resources away from its global blockchain investment.

Earlier this week, the company disclosed in a stock exchange filing that its newly-invested Hangzhou unit has signed a cooperation agreement with a hemp research institute in the province of Heilongjiang to jointly develop at least five varieties of hemp germplasm, with at least two developed as medicinal cannabis products.

The cooperation agreement came even as Grandshores Technology is still trying to complete its 40-per cent equity stake investment in the Hangzhou unit, called Hangzhou Yupu Trading, a company that holds the right to use 1,600kg of the seeds of a particular cannabis plant by the Heilongjiang hemp research institute for one year. Heilongjiang and Yunnan are the only two provinces in China currently where the cultivation of industrial hemp is allowed.

“Both blockchain and industrial cannabis are the future, and both are embraced by the younger generation. Grandshores Technology is a company that invest in the future and we are always on the search for new business growth opportunities,” said Yao.

Industrial hemp are cannabis plants that have no more than 0.3 per cent of THC (delta-9-tetrahydrocannabinol).

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