Executive Summary / Key Takeaways

• Solowin Holdings is strategically transforming into a comprehensive financial services provider, bridging traditional finance (TradFi) with the burgeoning Web3 ecosystem, particularly in Hong Kong and expanding globally. This pivot is underpinned by its first-mover advantage in regulated virtual asset services in Hong Kong.
• The company's innovative Solomon VA platform, an institutional-grade all-in-one smart trading app, integrates traditional and virtual asset trading with wealth management, offering a significant technological differentiator in a competitive market.
• While Solowin reported a net loss of $8.54 million in fiscal year 2025, reflecting strategic investments in new ventures and increased operational costs, its virtual assets segment generated initial revenue of $15,000, and corporate finance services saw a substantial 733% revenue increase to $0.999 million.
• Recent strategic acquisitions, including AlloyX Limited for stablecoin infrastructure and a stake in GPL Remittance for cross-border payments, alongside global expansion initiatives in the UAE and an intent to acquire a U.S. licensed bank, signal aggressive pursuit of new growth avenues.
• Key risks include evolving PRC regulatory oversight, potential stock price volatility, and high client concentration, with the top five customers contributing 81% of total revenues in fiscal year 2025.

The Web3 Frontier and Solowin's Strategic Pivot

Solowin Holdings (NASDAQ:SWIN) is strategically positioning itself at the nexus of traditional finance and the rapidly expanding Web3 ecosystem, primarily operating through its wholly-owned Hong Kong subsidiaries, Solomon JFZ Asia Holdings Limited (SJFZ) and Solomon Private Wealth Limited (SPW). The company's core business, historically rooted in securities brokerage and investment advisory, is undergoing a significant transformation, driven by a vision to build an integrated financial services infrastructure for next-generation investors. This strategic pivot is particularly timely given Hong Kong's proactive stance in fostering a regulated environment for virtual assets, which is attracting substantial investment and innovation in the region.

Hong Kong is rapidly emerging as a global Web3 hub, with its Monetary Authority (HKMA) and Securities and Futures Commission (SFC) crafting a forward-thinking regulatory framework that balances innovation with stability. The fintech sector in Hong Kong expanded to over 1,200 firms by 2024, with approximately 41.5% focusing on blockchain and digital assets, marking a 250% increase since 2022. The global tokenized assets market, excluding cryptocurrencies, is projected to reach $2 trillion by 2030, with Hong Kong leading Asia's Real-World Asset (RWA) tokenization boom, a market projected to reach $18.9 trillion by 2033. This dynamic environment provides a fertile ground for Solowin's ambitious expansion.

Technological Foundation and Innovation Edge

At the heart of Solowin's strategy is its commitment to technological differentiation, exemplified by the Solomon VA platform. This institutional-grade, all-in-one smart trading app, launched in July 2024, innovatively combines traditional asset trading, virtual asset trading, and wealth management services into a single, seamless application. The platform offers a bilingual user interface and is designed for fast and efficient order execution, providing a superior user experience. Solomon VA facilitates trading of over 10,000 listed securities and derivative products across major exchanges like the Hong Kong Stock Exchange (HKSE), New York Stock Exchange, Nasdaq, Shanghai Stock Exchange, and Shenzhen Stock Exchange.

A key technological differentiator is Solomon JFZ's approval by the HKSFC to provide virtual asset dealing and advisory services, making it among the pioneering licensed platforms in Hong Kong to offer both traditional and virtual asset services to retail investors. The platform supports in-kind subscription and redemption for spot virtual asset ETFs, including Bitcoin and Ethereum, enabling direct exchange with underlying digital assets. Solowin's R&D team, comprising four internal product officers, focuses on back-end and front-end development, API and Fix connection development, user interface, testing, and maintenance. The company invested approximately $0.46 million in R&D for the fiscal year ended March 31, 2025, demonstrating ongoing commitment to enhancing its technology infrastructure and optimizing product offerings. The strategic goal is to provide customized Business-to-Business (B2B) solutions to institutional clients through API integration, further optimizing the trading system for increased concurrent accesses, improved stability, security, and faster execution order matching.

A History of Strategic Evolution

Solowin's journey began with the incorporation of Solomon JFZ in Hong Kong in July 2016, initially focusing on securities-related services. Over the years, SJFZ expanded its offerings to include asset management (April 2021), corporate consultancy (May 2021), and investment advisory services (October 2021). The parent company, SOLOWIN HOLDINGS, was established in the Cayman Islands in July 2021, culminating in a pre-IPO reorganization that solidified its holding company structure.

A significant milestone was the company's initial public offering (IPO) on September 8, 2023, listing its Class A Ordinary Shares on Nasdaq under the symbol SWIN. This event provided approximately $7.07 million in net proceeds, which have been strategically deployed for business expansion, recruitment, funding HKSFC capital requirements, and sales and marketing. In December 2024, a re-classification of ordinary shares established a dual-class voting structure, concentrating voting control in Class B Ordinary Shares, which hold ten votes per share.

Financial Performance: A Period of Transition

Solowin Holdings has experienced a period of significant financial transition, marked by both challenges and emerging opportunities. For the fiscal year ended March 31, 2025, total revenue decreased by 34% to $2.82 million from $4.29 million in the prior year. This decline was primarily driven by a 64% decrease in investment advisory fees, which fell to $1.02 million from $2.86 million, largely due to a reduced client base and decreased demand for value-added services among institutional clients. The company reported a net loss of $8.54 million for fiscal year 2025, widening from a $4.56 million net loss in fiscal year 2024, contrasting with a net income of $1.35 million in fiscal year 2023.

Total expenses increased by 26% to $10.95 million in fiscal year 2025, from $8.72 million in the previous year. This rise was mainly attributed to increased general and administrative expenses, marketing and promotion efforts aimed at enhancing brand visibility, and professional fees related to the newly launched virtual assets business and a proposed follow-on offering. Despite the overall revenue decline, the Corporate Finance Services segment demonstrated robust growth, with income increasing by 733% to $0.999 million in fiscal year 2025, driven by new client acquisitions and a growing interest from corporate clients seeking U.S. market listings. The newly introduced Virtual Assets Services segment also began contributing, recognizing $15,000 in transaction income in fiscal year 2025, signaling the initial impact of this strategic diversification.

Liquidity remains a focus, with cash and cash equivalents increasing to $3.84 million as of March 31, 2025, from $2.14 million in the prior year. The company's management believes its current cash levels and operating cash flows will be sufficient for at least the next 12 months.

Net cash used in operating activities was $1.06 million for fiscal year 2025, primarily due to the operating loss before working capital changes, partially offset by decreases in receivables. Financing activities provided $2.38 million in cash for fiscal year 2025, including $1.00 million from shareholders' contributions and $0.942 million from directors' advances.

Strategic Initiatives and Growth Catalysts

Solowin is aggressively pursuing a multi-faceted growth strategy centered on expanding its Web3 capabilities and global footprint. A pivotal development was the completion of a $350 million acquisition of AlloyX Limited in September 2025, a Hong Kong-based fintech company specializing in cross-border payments and institutional-grade asset tokenization through stablecoin infrastructure. This merger is expected to fully leverage the strengths of both parties in traditional finance and the Web3 ecosystem, building a new financial ecosystem centered on stablecoins and driving deep integration between traditional finance and digital assets.

Further solidifying its global ambitions, Solowin announced its intent to acquire a U.S.-licensed bank in September 2025, a move anticipated to be a "pivotal milestone and acceleration in Solowin's global expansion strategy." In August 2025, the company launched its Dubai Operations Center and initiated an application for a Category 3C asset management license from the Dubai International Financial Centre (DIFC), following a strategic collaboration with CITIC Construction for financial technology infrastructure development in Saudi Arabia. These initiatives underscore Solowin's commitment to expanding into high-growth markets like the UAE, ASEAN, and Africa.

The company also acquired a 19% equity stake in GPL Remittance Pte. Ltd., a Singapore-based cross-border payment institution with a Major Payment Institution (MPI) license, in August 2025, enhancing its digital payment infrastructure. In a move to bolster its Web3 presence, Solowin made a strategic investment in ME Group (formerly MetaEra), a Web3 industry news platform, in August 2025. These strategic partnerships and acquisitions are expected to contribute to Solowin's goal of achieving US$1 billion in assets under management (AUM) for its USD Money Market Real Yield Token (RYT) by the end of 2025, a product launched in April 2025 in collaboration with major financial institutions.

Competitive Landscape: Operating in a Dynamic Arena

Solowin operates in a rapidly evolving, fragmented, and competitive Hong Kong online securities brokerage market. It faces fierce competition from other online brokerage platforms, investment and trading platforms, and traditional financial institutions. Key publicly traded competitors include Futu Holdings , Upfintech Holding , and Interactive Brokers , each with distinct strengths and market positioning.

Futu Holdings (FUTU), a technology-driven online brokerage, boasts strong revenue growth and improved profitability through its user-friendly platforms and international reach. While Futu's technological edge and broader integration of analytical tools provide efficiency in trade execution, Solowin differentiates itself through personalized advisory services and a comprehensive suite of offerings tailored to Hong Kong's specific regulatory and client needs. Upfintech Holding (TIGR) (Tiger Brokers) focuses on cost-effective, accessible trading for retail investors, often with faster adoption rates due to its simpler platform. Solowin, in contrast, offers a broader range of services including corporate finance and asset management, appealing to institutional clients and potentially generating more stable cash flow from recurring fees, though it may face higher operational costs. Interactive Brokers (IBKR), a global online brokerage, is renowned for its technologically superior platform, advanced analytics, and global reach, leading to consistent revenue growth and strong profitability. Solowin's market positioning as a Hong Kong specialist, with its integrated Solomon VA platform, aims to provide a more localized and integrated experience, potentially fostering stronger customer loyalty in its home market, but it may lag in technological innovation and global scale compared to IBKR.

Solowin's competitive advantages, or "moats," include its HKSFC regulatory licenses and local expertise, which foster stronger customer loyalty and potentially higher margins in Hong Kong. Its proprietary Solomon VA trading platform offers integrated access to multiple exchanges, enhancing multi-market trading efficiency. However, Solowin's smaller scale compared to global players like IBKR could lead to higher operational costs and potentially limit market share in price-sensitive segments. Furthermore, while Solowin is a first mover in regulated virtual assets in Hong Kong, it faces the challenge of rapidly evolving technology, where larger competitors might have greater resources for continuous innovation.

Key Risks and Headwinds

Investing in Solowin Holdings carries several pertinent risks that could impact its investment thesis. The company faces significant legal and operational uncertainties stemming from its Hong Kong base and a majority PRC-resident client base, particularly concerning the complex and evolving PRC laws and regulations. There is a risk that the PRC government could intervene or impose restrictions on its HK Subsidiaries' ability to move cash out of Hong Kong to distribute earnings or pay dividends to U.S. investors. While Solowin currently believes it is not subject to the New Overseas Listing Rules or cybersecurity reviews, "there remain substantial uncertainties surrounding the enforcement thereof, we cannot assure you that, if required, we would be able to complete the filings and/or fully comply with the relevant new rules on a timely basis for future offerings, if at all."

Furthermore, the company's Class A Ordinary Shares "may be prohibited from trading in the United States under the HFCA Act in the future if the PCAOB is unable to inspect or investigate completely our auditors." Although Solowin's current auditor is U.S.-based and subject to PCAOB inspection, "uncertainties still exist as to whether the PCAOB will have continued access for complete inspections and investigations in the future." Another significant risk is client concentration, with the top five customers contributing approximately 81% of total revenues for the fiscal year ended March 31, 2025. This reliance on a small number of key clients makes the company vulnerable to fluctuations in their trading volumes or changes in their business relationships. Lastly, Solowin relies on external service providers for its technology and operational functions, such as Full Node Technology Limited for its Solomon VA platform, and any failure or interruption in these services could adversely affect its business and reputation.

Conclusion

Solowin Holdings is at a critical juncture, strategically pivoting to become a leading integrated financial services provider in the dynamic Web3 space, particularly within the regulated Hong Kong market. Its first-mover advantage in offering HKSFC-licensed virtual asset services, coupled with the innovative Solomon VA platform, forms the bedrock of its competitive strategy. While recent financial results reflect the substantial investments required for this transformation, with a net loss in fiscal year 2025, the significant growth in corporate finance services and the nascent revenue from virtual assets underscore the potential of its strategic initiatives.

The company's aggressive expansion through acquisitions like AlloyX and its intent to secure a U.S. banking license demonstrate a clear vision for global growth and diversification. However, investors must weigh these opportunities against inherent risks, including the evolving regulatory landscape in the PRC, potential stock price volatility, and a concentrated client base. Solowin's ability to successfully execute its technological roadmap, navigate complex regulatory environments, and effectively integrate its new ventures will be paramount in realizing its ambitious AUM targets and solidifying its position as a bridge between traditional finance and the decentralized future.