CoinShares Gears Up for Nasdaq Listing: A Look at the Web3 Landscape

CoinShares Heads to Nasdaq: A Milestone in the Web3 Sector

Following in the footsteps of Coinbase, Galaxy Digital, Circle, Bullish, and Gemini, the US stock market is set to welcome another Web3 company. On September 8th, European crypto asset management firm CoinShares will merge with Vine Hill Capital Investment Corp, a special-purpose acquisition company (SPAC) listed on Nasdaq, along with a newly established Jersey-based company, Odysseus Holdings Limited. Post-merger, CoinShares will be listed on Nasdaq (or another US exchange) and delisted from Nasdaq Stockholm. This move marks the first European-based Web3 company to tap into the US capital market, following several US-based counterparts.

CoinShares’ origins trace back to Global Advisors, a commodities investment firm founded in 1998 by Russell Newton and Danny Masters. Newton, with eight years of crude oil trading experience at companies including Shell Oil, joined JPMorgan in July 1994 as a commodities strategist. Co-founder Danny Masters, also the current Chairman of CoinShares, previously served as Head of Global Energy Trading at JPMorgan before co-founding Global Advisors with Newton.

Economist JM Mognetti, the current CEO of CoinShares, joined Global Advisors in 2012. Just a year later, global macro investors began significantly withdrawing from commodities in favor of stocks and fixed income. For the three, the company urgently needed to find new investment directions, and it was at this time that Bitcoin, priced at just a few hundred dollars, caught their attention. With little hesitation, Global Advisors fully transitioned into the digital asset space in 2014, later rebranding as CoinShares in 2016, gradually evolving into a crypto asset management firm that integrates asset management, capital markets operations, and proprietary investment.

In 2014, Global Advisors launched Europe's first regulated Bitcoin investment fund. After the rebranding, CoinShares acquired XBT Provider, which launched the first Bitcoin-based security listed on a regulated exchange; its Bitcoin Tracker One ETP was launched in Sweden in 2015.

In early 2024, after the SEC approved multiple spot Bitcoin ETF applications, CoinShares acquired Valkyrie, one of the issuers of spot Bitcoin ETFs. As of this writing, Valkyrie's Bitcoin spot ETF has over $650 million in assets under management (AUM). Beyond asset management, investment is also a key business for CoinShares. At the time of its 2021 listing, CoinShares disclosed its investments in Canadian crypto asset management firm 3IQ Corp and the parent company of US-qualified custodian Kingdom Trust at the end of 2020.

In 2021 and 2022, CoinShares invested twice in Swiss online bank FlowBank, holding a stake of nearly 30% at its peak. However, FlowBank declared bankruptcy in 2022 due to insolvency. Having covered the development history of CoinShares, let's discuss its financial status.

Comparing CoinShares' Q1 and Q2 financial reports released this year, Q1 revenue was $39.958 million, down approximately 15.88% year-over-year (YoY), and earnings before interest, taxes, depreciation, and amortization (EBITDA) were $29.781 million, down approximately 15.7% YoY, but the profit margin increased slightly by 75%, a slight increase YoY. Including changes in the prices of the company's self-held crypto assets, taxes, etc., CoinShares' total comprehensive income for Q1 this year was approximately $24.79 million, down 42.1% compared to the same period last year.

In asset management, which accounts for the largest proportion, CoinShares recorded revenue of $29.566 million in Q1, accounting for approximately 74% of total revenue, up approximately 20.8% YoY. Profit after direct costs and administrative expenses was approximately $22.714 million, a slight increase of approximately 5% YoY.

In capital markets infrastructure, CoinShares recorded approximately $11.911 million in Q1, down approximately 15.4% YoY.

CoinShares' so-called capital markets infrastructure business includes providing liquidity revenue, Delta-neutral trading strategy revenue, digital asset lending, and staking revenue. Profit after direct costs and administrative expenses was approximately $9.335 million, down approximately 18.7% YoY.

In proprietary investment, CoinShares incurred a loss of approximately $1.519 million in Q1, compared to a profit of approximately $8.942 million in the same period last year, a YoY decrease of approximately 117%. In Q1, due to the overall decline in cryptocurrency prices, except for the asset management business, which is not significantly affected by prices, other business conditions deteriorated. Looking closely at the financial statements, in capital markets infrastructure, providing liquidity, lending, and staking revenue were significantly affected by price declines and trading inactivity, but Delta-neutral strategy trading offset some losses, while the investment business was mainly dragged down by the overall price decline. Overall, CoinShares did not see a decline in its core business, and it actively adjusted its investment strategies. In Q2, cryptocurrency prices generally increased, but CoinShares' business did not grow significantly accordingly.

CoinShares recorded revenue of $41.519 million in Q2, up approximately 3.8% QoQ and up a significant 258.3% YoY. EBITDA was $26.299 million, down 11.7% QoQ and down approximately 22.7% YoY, and the profit margin also decreased to 63%.

CoinShares' total comprehensive income for Q2 was approximately $25.578 million, up slightly by approximately 3.2% QoQ and up slightly by 1.1% YoY. For the entire first half of the year, due to the inclusion of the FlowBank bankruptcy loss and the revenue from the sale of FTX claims in 2024, the data is somewhat distorted (hence the significant YoY increase in revenue is also abnormal). Excluding this portion of the data, CoinShares' performance in the first half of this year did not change significantly compared to the same period last year.

In asset management, CoinShares recorded revenue of slightly over $30 million in Q2, up slightly by 1.6% QoQ and up 6.1% YoY. Operating profit was $21.748 million, down approximately 4.3% QoQ and down approximately 10.3% YoY. Total asset management business revenue for CoinShares in the first half of the year was approximately $59.613 million, up 12.4% YoY, and operating profit was $44.462 million, down 3.5% YoY.

CoinShares stated that XBT-launched products experienced net outflows of $126 million in Q2, and the company allocated more expenses and fees to the asset management department, resulting in continued profit declines despite increasing asset management revenue.

In capital markets infrastructure, CoinShares recorded revenue of approximately $11.346 million in Q2, down 2% QoQ and down 22.3% YoY. In terms of profit, excluding the additional income generated from the sale of FTX claims, both profit amount and profit margin declined.

In proprietary investment, CoinShares only had a profit of nearly $125,000 in Q2. Although there was a certain increase compared to the Q1 loss of approximately $1.519 million, investment losses and profits are somewhat random in terms of timing and are not strong references. It is worth noting that CoinShares has been in a loss position in investment throughout 2024 and so far in 2025. In the entire year of 2023, CoinShares achieved a profit of nearly $3.7 million in investment.

Although CoinShares stated in its roadshow materials that its total assets under management (AUM) have exceeded $8 billion, making it the fourth-largest crypto asset management institution globally after BlackRock, Grayscale, and Fidelity, and also the largest crypto asset management institution in the EMEA (Europe, Middle East, and Africa) region, accounting for approximately 34% of market share, based on the data above, CoinShares' growth is relatively slow. In addition to the steady slight growth in the asset management business, the performance of other businesses fluctuates significantly.

CoinShares' acquisition of Valkyrie and its listing in the US are essentially aimed at expanding its business in the US, but its main base does not seem to have any unique moat. According to ISS Market Intelligence data, as of the end of May this year, the assets under management of US fund companies in Europe have increased from $2.2 trillion a decade ago to $4.9 trillion. If US-based asset management giants intend to expand their crypto asset management business to Europe, CoinShares will have to face strong competitors. Assuming the SEC approves more cryptocurrency ETFs in the future, CoinShares' current advantage may gradually erode. Based on yesterday's closing price of European stocks, CoinShares' market value is approximately 8.228 billion Swedish krona, equivalent to $877 million USD, and the price-to-earnings ratio is approximately 7.97, but its "reverse merger" valuation reached $1.2 billion USD, a premium of nearly 37%. Compared to the world's largest asset management company, BlackRock, which had $12.5 trillion USD in AUM at the end of Q2 this year, CoinShares' ratio of AUM to market value far exceeds BlackRock, but its price-to-earnings ratio is much lower than BlackRock's nearly 27. This makes CoinShares' valuation present a relatively contradictory situation. While crypto asset management will be a hot commodity for a considerable period of time in the future, whether CoinShares' market value can experience significant growth, from a rational perspective, may depend on whether the asset management business can achieve unexpected growth, whether it can build a moat in non-US regions, and whether it can grab a slice of the pie in the US.