Analyst Coverage Reports
CoinShares International: Tech-driven pioneer in digital assets
"CoinShares International (CS) is a fintech business created to support the emergence of digital assets as a new investible asset class. However, it is more than a simple beta play on the bitcoin price, as its proprietary technology facilitates both regulated issuance platforms (with CS’s assets under management, AUM, at US$6.5bn currently) and gains derived from capital markets activities, including liquidity provisioning, non-directional trading and fixed income activities. Hence, CS benefits from the inherent high volatility of digital assets, and in turn offers a certain level of downside protection in case of adverse digital asset price performance."
To read more of Edison's breakdown of CoinShare's investment summary, valuations, sensitivities, and strategy, download the full report in the right hand column.
Europe’s Largest Digital Asset Firm is Adding Crypto Access for Consumers to Grow its TAM
- CoinShares is Europe’s largest and longest standing digital asset firm. Its 2021 performance shows it can deliver significant profit growth (adjusted EBITDA grew over 5x Y/Y) while improving its existing infrastructure to give more investors access to the growing digital asset ecosystem.
- Since 2014 the company has used a proprietary, algorithm-powered trading services software for its asset management and capital market activities. In 2H21 the company acquired a B2C company, Napoleon, to continue its ongoing evolution and exploration of commercial opportunities across the entire digital asset ecosystem. Its core software, Galata, has historically supported CoinShare’s activities and continues to evolve in order to power these new opportunities.
- In 2021 CoinShares had a record year. It grew adjusted EBITDA to £122 million from £22 million in 2020, over 5x. The company saw its revenues (comprising management fees, trading gains, fair value gains and other income) grow in all segments Y/Y in 2021. Adjusted EBITDA margin increased from 61% to 80%.
- Total assets under management (AUM) at the end of 2021 were £4.2 billion. The company’s Capital Markets Infrastructure segment generated a record £62.1 million across its various activities.
- With CoinShares adding consumer-targeted offerings, its total addressable market has grown to 200 million cryptocurrency investors, a number that is expected to rise over the years.
- The company’s comparables include other crypto/digital management companies. The seven comps we identify below have a median forward P/E of 26.4x while CNSRF is trading at 4.9x, an 81% discount. CNSRF is trading near 17% of its 52-week low, roughly in line with its comps.
- We will be hosting CoinShares CEO Jean-Marie Mognetti for a fireside chat on March 10, 2022, at 11 am ET. It is open to all investors. Click here to register.