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Deal-flow and Disciples

The confluence of Reddit, Robinhood and GME has been a fascinating distraction. GFO-X believes in transparent price discovery and the freedom to trade at all times.

Meanwhile, the cryptocurrency eco-system has been frantic with news of exchange listings and capital raises. Increased positive commentary from investment luminaries and institutions is lending more support to the longer-term appetite for cryptocurrencies.

Capital Markets Activity

Cryptocurrency giant Coinbase, which announced plans to go public in December, intends to sell its shares through a direct listing. Valuations rumoured to be anywhere from $50bn-75bn. The last time Coinbase publicly disclosed its valuation was following a Series E funding round in 2018 that priced the company at $8 billion.

BAAKT SPAC: Bakkt, the cryptocurrency platform majority-owned by ICE is in advanced talks to go public through a merger with blank-check firm VPC Impact Acquisition Holdings. The rumoured valuation is around US$2bn.

Diginex (EQOS) who raised US$20m back in September 2020 ahead of its October 2020 NASDAQ listing, raised a further U$$38.6m in mid-January 2021 The stock has traded from lows of US$5 to US$20.64 in January 2021. It has a current market cap of US$525m.

Coinbase continues to acquire companies in the sector, including trade execution startup Routefire to beef up their institutional offering. Their latest acquisition is Bison Trails, a blockchain infrastructure platform that includes staking features.

For more on crypto trends and M&A, read The Block’s 2021 analyst predictions. A few that stand out:

  1. The market structure continues to mature, with options having another big year.
  2. Non-custodial derivatives take off due to Optimism and capture 10% of CEX’s open interest by year-end.
  3. Total venture funding in the sector nearly doubles in 2021 to $6.0 billion
  4. At least one infrastructure provider is acquired for >$400 M and becomes the largest M&A transaction to date.
  5. US/EU regulators will try to force KYC/CTF regulations onto popular DeFi applications.

Retail and Institutions still warming to Bitcoin

  • Investment giant BlackRock filed documents with the Securities and Exchange Commission showing that it wants to include cash-settled Bitcoin futures as eligible investments for two of its funds—the latest instance of a major financial institution dipping a toe into cryptocurrencies.   
  • Bill Miller IV of US$3.5bn AUM Miller Value Partners discusses their appreciation of BTC and why they invested in the MicroStrategy CB.
  • The eToro platform signed 530,000 new users globally in the first 17 days of 2021. It also said cryptocurrency trading volumes were 25 times higher YoY. The platform says one third of sign-ups were in their 30s, two out of five were under the age of 30 and the majority invest in cryptocurrencies.
  • Grayscale inflows in 4Q 2020 reached US$3.3bn, a threefold increase from the previous quarter. 93% of new investments came from institutional investors. Grayscale also discussed “surging demand from wealth managers”. Total AUM is now over US$20.2bn.
  • Ray Dalio in a lengthy article concludes with these words “Overall, it’s clear that Bitcoin has features that could make it an attractive store hold of wealth” However, he has hedged his view, “Bitcoin looks like a long-duration option on a highly unknown future that I could put an amount of money in that I wouldn’t mind losing about 80% of”
  • Apparently, Harvard, Yale and Brown endowments have been buying BTC for at least a year.
  • Visa may add cryprocurrencies to its payment network. Visa CEO Al Kelly said the payments giant is in a position to make cryptocurrencies more “safe, useful and applicable” and may add them to the company’s payments network. “Our strategy here is to work with wallets and exchanges to enable users to purchase these currencies using their Visa credentials or to cash out onto our Visa credential to make a fiat purchase at any of the 70 million merchants where Visa is accepted globally,” Kelly said. 
GFO-X Team
Author: GFO-X Team