Cryptocurrencies have been some of the most exciting recent technological developments. Cryptos promise a revolution in financial services, threatening to shake up everything from payments, to auditing, to trading. Yet when most investors think of cryptos, their minds tend to think of buying bitcoins directly. However, there are many fintech companies that help provide crypto products, services and innovation. Below we discuss our top five.
The companies listed below are all found in the ETFS Fintech & Blockchain ETF (Exchange Code: FTEC).
Galaxy Digital Holdings
Galaxy is something like an investment bank for crypto and one of the biggest crypto pure-plays in the world. Its founder Mike Novogratz is something of a Wall St celebrity. Galaxy has fingers in many crypto operations include crypto mining, where it mines bitcoin. Crypto venture capital, where it invests both its own and other peoples’ money in promising blockchain businesses, and crypto trading, where it trades cryptocurrencies outright.
Coinbase is arguably a household name in the cryptocurrency market. It is most famous for running the biggest platform for trading cryptocurrencies, and provides something like an exchange for people to buy and sell bitcoin, Ethereum, Solana and the like, but Coinbase is increasingly branching out and offering other services, such as custody. This is where Coinbase holds and stores cryptos on behalf of investors -quite like a custody bank.
Square became famous in Australia recently thanks to its purchase of Afterpay. The company, run by Twitter boss Jack Dorsey (CEO of both companies), built the Square card reader, which is essentially a smaller faster EFTPOS machine. Square gives its card readers away for free to businesses, which has allowed it to build a huge network of small business users. It then takes fees from payments that go through its machine. In recent years, Square has also been building more software and other products (like loans) for businesses that use its app. It also runs the Cash App, which competes with Venmo.
CME Group is based in Chicago and one of the largest exchanges in the world. It provides bitcoin futures and the venue on which bitcoin futures are traded. Bitcoin futures have taken a back seat to the trading of physical bitcoins. However, with the launch of bitcoin futures ETFs in October 2021, the open interest in bitcoin futures has increased.
Hive Blockchain is the first publicly traded crypto miner, based in Canada. The company uses 100% green energy to mine both bitcoin and Ethereum. Its mining rigs are based in Scandinavia (Iceland, Sweden) where the cost of renewable energy is lower. Hive holds onto many of the cryptocurrencies that it mines, meaning that its share price is heavily affected by the value of cryptocurrency.
Access with FTEC
For those wishing to invest in crypto innovators such as this, FTEC provides one way. FTEC invests in 75 of the world’s leading crypto innovators and fintech companies in Australia and around the world.