ASX crypto stocks are all pumped up as Bitcoin bursts through $US11,000
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Cryptocurrency Bitcoin is up 80 per cent in the past month — and most ASX-listed stocks with even a whiff of exposure are along for the ride.
The wildly volatile digital currency burst through $US10,000 on Wednesday and — without even pausing — carried on to a high of $11,377. Within hours the price plummeted back to $US9300 — before climbing again to $US10,400 by lunchtime Thursday.
A month ago a single Bitcoin was worth $US6120. The next most popular digital currency, Ethereum, passed the $US500 mark last night — up two-thirds for the month.
Cryptocurrencies such as Bitcoin and Ethereum are created and held electronically. They are not backed by any bank — and are instead supported by a computer-based “blockchain” technology that provides a public ledger of transactions.
Stockhead tracks 15 ASX stocks that are directly or indirectly — and sometimes tenuously — connected to blockchain or cryptocurrency.
All but two of those stocks have made gains over the past month.
One — tiny Byte Power Group — is up by 600 per cent.
The ASX’s best-known blockchain play, DigitalX, has almost quadrupled.
Another three crypto-exposed stocks — First Growth Funds, Novatti Group and Reffind — have more than doubled this month.
See below for a round-up of ASX-listed crypto stocks.
|Ticker||Name||2017 price change||Price (Jan 4)||2018 price change||Mkt Cap|
|BPG||Byte Power Group||799%||0.009||0%||20115630|
|FFG||Fatfish Internet Group||1.75||0.079||4%||34358176|
|FGF||First Growth Funds||1.28||0.037||118%||13836458|
|TSN||Transactions Solutions International||-0.6||0.011||0%||23386144|
Is this another dot com bubble?
Bitcoin filmmaker and expert Torsten Hoffmann says part of the reason for the recent big gains is because institutional money is getting into the game.
In early December, the Chicago Mercantile Exchange (CME) will launch Bitcoin futures which will create a route for institutions to invest. Another Chicago exchange, CBOE, is also considering a fourth quarter futures launch, as is the Nasdaq. Investment vehicles for the rest of us like ETFs and funds are logical follow-ons.
“Bitcoin has moved from the fringe where libertarians and tech geeks had these fantasies about what it can and cannot do, to being a serious contender to revolutionise the world of finance and software,” he told Stockhead.
This week Melbourne-based Apollo Capital and Nem.io Foundation said they were looking to invest in Australian startups.
The case for Australia was helped when the government stopped adding GST to Bitcoin purchases in July, and brought Bitcoin exchanges under the remit of the financial regulator AUSTRAC in August.
DigitalX chief Leigh Travers says interest in what they do — blockchain consulting and Initial Coin Offering — is rising rapidly as investors begin to understand how much of a fee they can command in that field.
An Initial Coin Offering is like an initial public offering — but instead of offering shares in a company, an issuer offers digital tokens that can be traded on cryptocurrency platforms or for digital services.
“The types of people that are reaching out to us [as clients] are ex-managing directors of some of the largest companies out there, and really reputable names in the financial world,” he told Stockhead.
“It’s been building every month for the last three months, but it’s definitely at an all time high.”
Whether rumour or actual deals, the blockchain and cryptocurrency hype has made November a fabulous month for ASX-listed stocks with exposure to the technology.
About a dozen of those have something to do with blockchain software or cryptocurrency, or say they do.
For a few others the link is more tenuous or even speculative.
Here’s a list of ASX-listed stocks with some kind of blockchain or crypto exposure:
Who’s who in ASX-listed crypto stocks
DigitalX (ASX:DCC) is Australia’s only listed cryptocurrency exchange, and is still hoping to do its Bitcoin ATM deal with Stargroup — if that company’s subsidiaries survive receivership.
Yojee (ASX:YOJ) does blockchain logistics in Asia and Australia.
Kyckr (ASX:KYK), a regulatory technology company, has built a blockchain-based corporate identity platform for compliance.
Fatfish Internet Group (ASX:FFG) has invested in a new cryptocurrency exchange to be set up in Singapore by the founder of Chi-X, Tony Mackay.
Mobecom (ASX:MBM) has turned loyalty points into a digital currency that are redeemable at participating businesses.
The still-in-planning-stage options
iCandy is involved with building a gaming marketplace with an in-house currency called ‘NOX’. CEO Kin Wai Lau says they’ve raised $2.5 million for it so far and open crowdfunding on Friday.
He’s a firm believer that cryptocurrencies are the way forward for online gaming as a more efficient way to make the micro payments common in that industry.
Digital bank Change Financial (ASX:CCA) plans to invest in the Ivy Project which owns IvyKoin — a blockchain based cryptocurrency that can be voluntarily de-anonymised to reveal details about a transaction.
Payments facilitator Novatti (ASX:NOV) isn’t involved in the sector per se, but says its own software can work with blockchain software and, if called on, can help a cashed-up Bitcoin owner convert their hoard into Aussie dollars.
Byte Power (AX:BPG) says it’s setting up a cryptocurrency exchange based out of Brisbane, with testing to start by the end of the year. It’s up 600 per cent on the back on that news.
But Reffind (ASX:RFN) and First Growth Fund (ASX:FGF) appear to have jumped on the bandwagon without much to show for it.
Software maker Reffind said in October that it appointed a blockchain expert, but the company is effectively cactus after major boardroom trials this year included a director and major shareholder sell out after succeeding in having the founder removed.
First Growth Fund said mid-month that it plans to set up a subsidiary digital currency.
The power of rumour
Shell companies Alchemia (ASX:ACL) and Zyber (ASX:ZYB) have both seen major share price movements on the back of unfulfilled rumours about blockchain or cryptocurrency deals.
On Monday, mobile banker Peppermint Innovations (ASX:PIL) flat out denied wanting to get into the space, calling it too risky for their new international remittance play, after investor gossip had linked the company to possible blockchain options.
Ookami (ASX:OOK), a website and an app that allow people to invest in IPOs, backdoor listings and capital raisings, fanned the flames in late October by saying it was looking at cryptocurrency ideas, smart contracts, and of course the blockchain.
Its share price shot up more than 130 per cent in August for no discernable reason, and it’s been on a tear ever since.
The latest company to be linked to the sector is Transaction Solutions International (ASX:TSN). It owns a cyber security company in Sydney and 25 per cent of an ATM operator in India.