Nasdaq will usher in the first stock of

# Written by: Eric, Foresight News  

Following Coinbase, Galaxy Digital, Circle, Bullish, and Gemini, the U.S. stock market is set to welcome another company from the Web3 industry.  

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 the U.S. NASDAQ, and newly established Jersey-based company Odysseus Holdings Limited. After the merger, CoinShares will be listed on the U.S. NASDAQ (or another U.S. exchange) and delist from NASDAQ Stockholm. Following the successive listings of several U.S.-based Web3 companies, the first European本土 (homegrown) Web3 enterprise is also set to enter the U.S. capital market.  

CoinShares traces its roots to Global Advisors, a commodities investment firm founded in 1998 by Russell Newton and Danny Masters. Russell Newton worked in crude oil trading for 8 years starting in 1986 at companies including Shell Oil, before joining J.P. Morgan in July 1994 as a commodities strategist. The other co-founder, Danny Masters—who also serves as CoinShares’ current Chairman—worked as J.P. Morgan’s Global Head of Energy Trading prior to co-founding Global Advisors with Russell Newton.  

JM Mognetti, an economist and CoinShares’ current Chief Executive Officer (CEO), joined Global Advisors in 2012. Just one year after his arrival, global macro investors began withdrawing heavily from commodities to shift their investments to stocks and fixed income. For the three co-founders, the company urgently needed to find a new investment direction—and it was at this time that Bitcoin, then priced at just a few hundred U.S. dollars, came to their attention.  

Without hesitation, Global Advisors fully shifted to the digital asset space in 2014. Later, in 2016, it rebranded as CoinShares and gradually evolved into the crypto asset management firm it is today, integrating 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—the issuer of the first Bitcoin-based security listed on a regulated exchange. XBT Provider’s Bitcoin Tracker One ETP was listed in Sweden in 2015.  

In early 2021, CoinShares began launching physically backed Exchange-Traded Products (ETPs). Currently, its ETP offerings cover not only Bitcoin and Ethereum but also tokens such as LTC, XRP, LINK, and UNI. In March of the same year, CoinShares was listed in Sweden, becoming the world’s second publicly traded Web3 company after Galaxy Digital (which was already listed on the Toronto Stock Exchange in Canada at the time). According to data provided by CoinShares, as of February 19, 2021, the firm’s assets under management (AUM) reached $4.56 billion, including 70,185 Bitcoins and 655,211 Ethers. This made it Europe’s largest crypto asset manager at the time and the second-largest globally (second only to Grayscale).  

By comparison, as of February 24, 2021, Grayscale’s total AUM stood at $39.3 billion; Bitwise’s AUM had just exceeded $1 billion; and Galaxy Digital’s AUM was $834.7 million as of January 31, 2021.  

In early 2024, after the U.S. Securities and Exchange Commission (SEC) approved Bitcoin spot ETF applications from multiple institutions, CoinShares acquired Valkyrie—one of the issuers of Bitcoin spot ETFs. As of the time of writing, the AUM of Valkyrie’s Bitcoin spot ETF exceeds $650 million.  

Beyond asset management, investment is also a key business for CoinShares. When it went public in 2021, CoinShares disclosed its investments in late 2020 in 3IQ Corp., a Canadian crypto asset management firm, and the parent company of Kingdom Trust, a U.S.-based qualified trust institution. In 2021 and 2022, CoinShares invested twice in FlowBank, a Swiss online bank, with its ownership stake peaking at nearly 30%. However, FlowBank filed for bankruptcy and liquidation in 2022 due to insolvency.  

Now that we have covered CoinShares’ development history, let’s turn to its financial situation.

When comparing CoinShares' financial reports for the first quarter and second quarter of this year released this year, the company recorded a revenue of $39.958 million in Q1, a year-on-year decrease of approximately 15.88%. Its Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) stood at $29.781 million, down about 15.7% year-on-year. However, its profit margin reached 75%, a slight year-on-year increase. Taking into account factors such as changes in the price of the company's self-held crypto assets and taxes, CoinShares' total comprehensive income in Q1 this year was approximately $24.79 million, a year-on-year decline of 42.1%.  

In the asset management business, which accounts for the largest proportion of its operations, CoinShares generated $29.566 million in revenue in Q1, accounting for about 74% of total revenue and representing a year-on-year growth of approximately 20.8%. After deducting direct costs and administrative expenses, the profit from this segment was around $22.714 million, a slight year-on-year increase of about 5%.  

In the capital market infrastructure business, CoinShares earned approximately $11.911 million in Q1, a year-on-year drop of roughly 15.4%. The company's so-called capital market infrastructure business includes income from providing liquidity, revenue from delta-neutral trading strategies, digital asset lending, and staking income. After subtracting direct costs and administrative expenses, the profit from this business was about $9.335 million, a year-on-year decrease of approximately 18.7%.  

In the proprietary investment business, CoinShares suffered a loss of around $1.519 million in Q1, compared with a profit of approximately $8.942 million in the same period last year, representing a year-on-year plunge of about 117%.  

In Q1, due to the overall decline in cryptocurrency prices, all other business segments saw a downturn except for the asset management business, which was not overly affected by price fluctuations. A closer look at the financial report reveals that in the capital market infrastructure business, income from liquidity provision, lending, and staking was significantly impacted by falling prices and sluggish trading activity. Nevertheless, delta-neutral strategy trading offset part of these losses. The investment business, on the other hand, was mainly dragged down by the overall market price decline. Generally speaking, CoinShares did not experience a downturn in its core businesses and has been actively adjusting its strategies in terms of investment.  

In the second quarter, cryptocurrency prices rose overall, but CoinShares' business did not see a significant growth accordingly.

# CoinShares' Q2 and H1 Financial Performance & Market Outlook

In the second quarter (Q2), CoinShares recorded a revenue of $41.519 million, representing a quarter-on-quarter (QoQ) increase of approximately 3.8% and a year-on-year (YoY) surge of 258.3%. Its Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) stood at $26.299 million, down 11.7% QoQ and approximately 22.7% YoY, with the profit margin also dropping to 63%. The company's total comprehensive income in Q2 was around $25.578 million, a slight QoQ rise of about 3.2% and a marginal YoY increase of 1.1%.  

For the first half (H1) of the year, the data is somewhat distorted due to the inclusion of losses from FlowBank's bankruptcy and gains from the sale of FTX claims in 2024 (which also led to an abnormal YoY surge in revenue). Excluding these one-off items, CoinShares' H1 performance this year showed little change compared to the same period last year.  

### Asset Management Business  

In Q2, CoinShares generated slightly over $30 million in revenue from its asset management business, a marginal 1.6% QoQ increase and a 6.1% YoY growth. Its operating profit from this segment reached $21.748 million, down approximately 4.3% QoQ and 10.3% YoY. For H1, the total revenue from asset management stood at around $59.613 million (up 12.4% YoY), while the operating profit was $44.462 million (down 3.5% YoY).  

CoinShares stated that in Q2, the products launched by its subsidiary XBT saw a net capital outflow of $126 million. Additionally, the company allocated more expenses to the asset management division. As a result, despite growing revenue from asset management, profits continued to decline.  

### Capital Market Infrastructure Business  

In Q2, CoinShares earned approximately $11.346 million from its capital market infrastructure business, a 2% QoQ decrease and a 22.3% YoY drop. Excluding the additional gains from the sale of FTX claims, both the profit amount and profit margin of this segment declined.  

### Proprietary Investment Business  

CoinShares posted a meager profit of nearly $125,000 from its proprietary investment business in Q2. While this marked an improvement compared to the $1.519 million loss in Q1, investment losses and gains are inherently random in terms of timing, making this figure of limited reference value. Notably, CoinShares has been in a state of loss in investments throughout 2024 and so far in 2025, whereas it achieved a profit of nearly $3.7 million from investments in 2023.  

Although CoinShares stated in its roadshow materials that its Assets Under Management (AUM) have exceeded $8 billion, making it the world's fourth-largest crypto asset manager (after BlackRock, Grayscale, and Fidelity) and the largest in the EMEA (Europe, Middle East, and Africa) region with approximately 34% market share, a comprehensive analysis of the above data reveals that CoinShares' growth is relatively slow. Except for the steady but modest growth in its asset management business, the performance of its other business segments has been highly volatile.  

CoinShares' acquisition of Valkyrie and its plan to list in the U.S. are essentially attempts to expand its U.S. operations. However, its home market (EMEA) does not seem to offer it a unique competitive moat.  

According to data from ISS Market Intelligence, as of the end of May this year, the AUM of U.S. fund companies in Europe had increased from $2.2 trillion a decade ago to $4.9 trillion. If major U.S.-based asset management giants intend to expand their crypto asset management business into Europe, CoinShares will have to face formidable competitors.  

Assuming the SEC approves more cryptocurrency ETFs in the future, CoinShares' current advantages may be gradually eroded. Based on yesterday's closing price of European stocks, CoinShares has a market capitalization of approximately SEK 8.228 billion (equivalent to $877 million) and a price-to-earnings (P/E) ratio of around 7.97. However, the valuation for its SPAC (special purpose acquisition company) listing in the U.S. has reached $1.2 billion, representing a premium of nearly 37%.  

Compared with BlackRock—the world's largest asset manager, with an AUM of $12.5 trillion as of the end of Q2 this year—CoinShares has a far higher ratio of market capitalization to AUM. Nevertheless, its P/E ratio is significantly lower than BlackRock's (nearly 27), resulting in a contradictory valuation for CoinShares.  

While crypto asset management is expected to remain a lucrative sector for a long time to come, from a rational perspective, whether CoinShares' market capitalization can achieve significant growth will likely depend on three factors: whether its asset management business can deliver growth beyond expectations, whether it can build a competitive moat in non-U.S. markets, and whether it can gain a foothold in the U.S. market.  

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