As the crypto market continues to blaze forward, European digital asset manager CoinShares’ revenue soared 33% in Q2. Riding the wave of the global crypto boom, the company’s proprietary trading activities contributed heavily to this revenue hike. CoinShares’ Q2 revenue reached a whopping £20.3 million ($25.9 million), a substantial increase compared to the same period in the previous year.
However, it’s not all just roses. While the trading activities flourished, the firm’s asset management fees saw a downturn. There was a 25% year-on-year decline in these fees to £10.6 million ($13.52 million), although this was counterbalanced by a £10 million ($12.76 million) gain from capital markets operations. Interestingly, the group’s total assets under management remained steady around the £2.1 billion ($2.68 billion) mark.
Stepping up its game, CoinShares has implemented the “Ledger Lens” tool. Backed by an unnamed accounting firm, this tool provides investors with real-time verification of the group’s Exchange Traded Products (ETPs).
Amidst the wave of regulatory developments across the crypto landscape, CoinShares’ CEO Jean-Marie Magnetti views the lawsuits by the U.S. Securities and Exchange Commission against Binance and Coinbase as potentially beneficial for traditional finance entities. Arguments aside, it is undeniable that such legal actions could pave the way for significant alterations in the regulatory framework.
CoinShares didn’t just stop at collecting ETP management fees; they ventured into decentralized finance, staking, and lending, pulling nearly £9 million ($11.48 million) from these activities in Q3 2023. This was a significant jump from Q2 2022 figures of £5.7 million ($7.27 million).
Yet, it’s hard to ignore the significant drop in revenue from liquidity provisions. Falling by 89% year-over-year, this was attributed to heavy outflows on CoinShares’ Bitcoin ETPs. While this might be a single damper in an otherwise vibrant quarter, it’s a gap the firm needs to bridge.
For the crypto enthusiasts amongst us, CoinShares’ journey in Q2 exhibits the undeniable dynamism and volatility of the crypto market. While opportunities abound, a wary eye on challenging terrain is warranted. To thrive in this new world, it’s all about striking a balance between embracing innovation and maintaining sound business practices.
Source: Cointelegraph
