Last week, cryptocurrency naysayers rubbed their hands with glee when Bitcoin values dropped through the floor, as China decided it wasn’t going to let people deal in the mystery bits anymore.
That was fun for a few days.
Then came Monday, when the new Frank Giustra-connected crypto play HIVE Blockchain (HIVE.V) joined the TSX Venture Exchange, and promptly showed not only is there a lot of love left out there for Bitcoin et al, but that the market players want in.
After a $0.30 financing that brought in some $16 million, the expectations were that the stock would debut around $0.50.
Reality blew through that level before the first stock was traded, with an $0.94 opening.
Canaccord’s Morning Coffee note today laid out good detail:
HIVE Blockchain Technologies started trading on the TSX Venture Exchange Monday. This follows the completion of a $16.5 million equity financing announced on September 7 and the closing of the acquisition from Genesis Mining of a state-of-the-art GPU-based blockchain data centre in Reykjanes, Iceland.
That facility is a monster. It’s such a monster, and so much money is being made on the crypto mining side, that the group has been renting Boeing’s to fly as many GPUs as they can get their hands on from the companies producing them, directly to the mining facility, in the quickest possible time.
Essentially, the cost of the Boeing is less than the lost opportunity in waiting for the post office to show up.
HIVE’s inclusion on the Venture Exchange is noteworthy given the lack of blockchain and mining-focused companies currently trading on the exchange.
Harry Pokrandt, President, CEO of HIVE, commented: “HIVE’s mission is to accelerate the blockchain sector through traditional capital markets and create long-term shareholder value.”
The list of big market players who bought into HIVE pre-public listing was impressive. Certainly we’ve been hearing a lot of buzz about crypto deals on the exchange over the last month or two, but it was always going to be a big day when the grownups finally got involved.
And get involved they have. HIVE’s Genesis deal makes it now one of the world’s largest crypto mining facilities, meaning it is generating money today. A lot of money. And when Bitcoin drops from $4000 to $2000 in value, HIVE can switch its servers to something else and continue pounding out doughbucks, relentlessly.
In tandem with its live share trading, HIVE Blockchain Technologies also has commenced with its mining operations following its closure of the transaction. Since last Friday September 15, the group has been undergoing an aggressive mining initiative to accumulate cryptocurrency.
“Our facility provides us significant flexibility to mine multiple cryptocurrencies including, but not limited to, Ethereum, Monero and ZCash. We will continue to examine other alt-coins for potential opportunities,” added Pokrandt.
The question I’ve heard from a lot of people regarding HIVE is, why would Genesis, which is making so much money, allow HIVE to come and buy into it for anything less than ridicu-loot?
Access, baby. Access.
“Blockchain technology has the potential to fundamentally improve transactions for all,” stated Holmes. He continued, “HIVE’s partnership with Genesis provides immediate exposure to operating margins of crypto mining and a growing portfolio of coins. That makes this a unique global company out of the gate.”
“The concept with HIVE is to give Genesis a footprint outside of the cryptocurrency world and build a bridge from the blockchain space to traditional capital markets,” commented Marco Streng, co-founder and CEO of Genesis Group.
There are many crypto-based and blockchain-based deals coming together to his the markets right now. Basically every broker has one coming. But HIVE isn’t a quick flit in the space, or an opportunist taking a shot. It’s not a “Hey everybody, look at me, I’m a crypto guy!” situation.
This is one of the world’s largest crypto mining operations. This is a mammoth entity that has been snagged because it wanted to be brought in from the underground and given a seat in the boardrooms of banks and insurance companies that would desperately like to know how they can use blockchain tech for their own ends.
Genesis just got that seat, courtesy of Frank Giustra and crew. In return, Giustra’s crew got themselves a $200 million company right out of the gate.
I bought in, and am excited to see where this ride takes us. So far, it’s been a wild one.
If you’re one of those people who scratches their head when they hear the phrase ‘blockchain’, this might help clarify things.
— Chris Parry
FULL DISCLOSURE: HIVE is not an Equity.Guru marketing client, but the author has bought in so please do your own due diligence and consult an investing professional before making any purchase decision.