Futu Holdings attempted a breakout Thursday after the broker and wealth management provider reported Q1 results. Futu's subsidiary Moomoo earlier this week announced plans to expand into the crypto space. Cantor is also loading up on crypto for its new bitcoin venture, Twenty One Capital.
Hong Kong-based Futu Holdings on Thursday reported a 90% increase in earnings to $1.96 per share. Sales jumped 81% to $603.4 million.
Analysts polled by FactSet expected earnings of $1.81 per share on $575.5 million in revenue.
The total number of funded accounts increased 41.6% for the quarter, while the number of brokerage accounts rose 30%. Futu's total users climbed almost 17% from last year. Total client assets jumped 60.2%. Daily average assets also ballooned 64.7%.
Meanwhile, Futu's subsidiary Moomoo on Tuesday announced an expansion into crypto trading for U.S. users. The new service, Moomoo Crypto, plans to launch 32 coins for investors to trade on its all-in-one platform. Moomoo in the news release said it will initially support trading for major cryptocurrencies including bitcoin, ethereum and "several other leading tokens" for current users. The list will expand in the coming months to allow all users access in a gradual launch, according to the release.
The platform will be backed by Moomoo Financial and leverage Coinbase's markets and infrastructure through its crypto-as-a-service (Caas) platform.
"With Moomoo Crypto, we're bridging the gap between traditional and digital finance, providing our users with the tools and insights they need to navigate this dynamic market," Neil McDonald, CEO of Moomoo's U.S. division, said in the release.
Brian Foster, global head of CaaS at Coinbase said he is seeing growing demand for platforms like Moomoo as crypto becomes "increasingly mainstream."
Futu Stock Breaks Out
FUTU stock initially rallied 7% Thursday, reversed for a 0.3% decline.
Shares briefly broke above a 114.98 cup-with-handle base. The buy zone, which stretches 5% beyond the buy point, extends to 120.73.
FUTU stock has a 21-Day ATR% of 4.79.
The average true range is a metric available on IBD's MarketSurge that gauges the characteristic breadth of a stock's behavior. Stocks that tend to make large jumps or dives in daily action, the kind that can trigger sell rules and shake investors out of a stock, have a high ATR. Stocks that tend to make more incremental moves have lower ATRs.
With the S&P 500 and Nasdaq now in a power trend, investors can buy stocks with ATRs up to 8%, though they should be wary of being too concentrated in high-octane names.
Cantor Loads Up On Bitcoin
Elsewhere, Cantor Fitzgerald on Tuesday announced that it has successfully executed its first transactions for its Bitcoin Financing Business. The business provides leverage to institutional investors who hold bitcoin and plans to make up to $2 billion of financing available in its initial phase.
Cantor Equity Partners, Cantor's special purpose acquisition company, announced on Thursday that it raised an additional $100 million for its new crypto venture, called Twenty One Capital.
According to an SEC filing, the company raised $100 million in convertible notes from existing investors that exercised their options to buy more notes. That was part of a $385 million convertible note sale in April.
That brings Twenty One's total funding to $685 million so far. The firm also raised $200 million in a private investment in public equity (PIPE) round last month.
SoftBank, Tether and Bitfinex are also backing Twenty One. The crypto venture will serve as a special purpose acquisition company and hopes to eventually go public to compete with the likes of Strategy.
Twenty One is being formed via a combination with Cantor Equity Partners. Once the deal is closed, Twenty One will be majority owned by Tether and Bitfinex. SoftBank will have "significant" minority ownership, according to the news release.
Shares of Cantor Equity will continue to trade on the Nasdaq under the CEP ticker. Once the deal is finalized, Twenty One plans to trade under the ticker XXI.
Cantor Equity Partners on May 13 disclosed that it purchased 4,812 bitcoin for $458.7 million in connection with the Twenty One launch. The firm plans to launch with more than 42,000 bitcoin, and a valuation around $3.6 billion.
CEP stock surged almost 5% Thursday.
Bitcoin Price
Bitcoin traded around $106,000 late Thursday, off its morning around $108,800 . The cryptocurrency last Wednesday rallied to a record $111,970 to surpass its previous peak above $109,200 set on Jan. 20.
Bitcoin is up about 9% over the past month, with a 14% gain year-to-date.
You can follow Harrison Miller for more stock news and updates on X/Twitter @IBD_Harrison
