2/ Super simple business. Ignore the Visa cards, the DeFi, etc. This is a simple business. Coinbase facilitates the exchange of cryptocurreny for real USD. Their fee structure is, for all intents and purposes, close to equal across the board
3/ 91% of revenue is transaction fees to retail. So the blend of higher margin retail to (presumably) lower institutional revenues doesn't really matter
4/ Bitcoin trading volumes are the bulk of the transactions so we'll ignore the doge/eth/other shitcoins since presumably volumes of all crypto scales as the assets are highly correlated
5/ Data per bitcoinity.org:
Q1 2021 BTC Trade Volume = $103.6 billion
Q2 2021 BTC Trade Volume = $86.7 billion
a QoQ decrease of ~16%
6/ Income is high in fixed costs so that revenue loss goes straight to the bottom line. That's -$255 million in revenues. Quick estimate is that a few institutional big trades and addition of Doge netted another $55-70 mm, So say QoQ down $200 mm
7/ Here's the kicker. 7 day rolling USD bitcoin trading volume at Coinbase is at December 2020 levels
8/ Management will likely have to guide down forward earnings and revenues.
$IBKR trades at 2.8x book and 2.3x revenues
$COIN trades at 22x book and 18x sales
The businesses are no different, fundamentally. Coinbase had 30% margins in Q1, during historic bull run
9/ Forget BTC fundamentals. This is a 63 billion dollar company that is looking to shrink in it's first year after going public. And let's not forget the insider sales.
$COIN
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Just incredible. No audited financials since 12/31 available to investors. This number went up a little bit in the past 6 months (by 5x)
just so we're clear, on 12/31/20 USDC was backed 100% by cash per financial statements. Now they're shilling "high yield" accounts at 200-500 bp above the risk free rate and no audited numbers that could explain where this yield could come from
Author has real world experience in Investment Banking and is now knee deep in construction and all that entails (labor costs, stimmies, manufacturing and obviously commodity costs)
His thesis is simple: a mispriced insurance product against events out of our control, especially weather. Add in a scarcity that's getting worse and you have a solid, real safehaven.
i keep seeing this piece shared. I'm no fan of Bitcoin, but there is zero evidence that this power plant is responsible for any noticeable increase in the temperature of senaca lake
The lake itself is roughly 4.5x10^12 gallons and the NPDES water permit allows for 5x10^10 gallons of water per year. Actual throughput is much less. So in an entire year up to 1% of the water can be sent thru the plant
now, lakes aren't perfectly mixed systems, so the dynamic is a bit more nuanced but even assuming a 5 ft thermocline that never turns over, that should model out to at most 1-2 degrees
most similar comp YETI
-10% rev growths
-recreational/bbq/hunting adjacent meme/status gear
-better margins than Traeger but def less durable, since brands like RTIC are literally identical
-trades at 8x sales
Slap a 15x sales valuation on it bc why not
my suspicion is that they'll focus on accessory sales. Good growth in that and at higher margins. Only so much blood you can squeeze out of 100+ pounds of steel and a PID controller.
Sauces, covers, misc grill doohickeys can push margins up a bit.