Which company stock would you love to buy in the current market situation?
During the the Bitcoin 2023 Miami, Eryka Gemma, CEO and Founder of Blockchain Center Miami, asked her guests, Brian Estes, Founder, CEO, and CIO of Off the Chain Capital; Mike Jarmuz, Managing Partner and Co-Founder of Lightning Ventures; and Greg Carson, Managing Partner of Humla Ventures, what industry stocks they were buying.
In response, Brian mentioned that Kraken is a good option for him. Although he emphasized that it’s not investment advice, he mentioned that accredited investors can acquire Kraken stocks through secondary markets. Individual investors can also purchase the stock, which is currently trading at a valuation of approximately $3 billion.
Brian mentioned that Kraken is currently trading at a discount compared to its $4 billion valuation in 2019. He also mentioned Bitpay and suggested that bitcoin maximalists, who aim to acquire bitcoin at a discounted price, should consider the Grayscale Bitcoin Trust or the Osprey Bitcoin Trust, as they hold approximately 30% to 40% of the bitcoin value in the trusts.
The CEO further mentioned that if the assets are eventually converted to ETFs and the value increases, investors will benefit from it.
Mike Jarmuz, Managing Partner and Co-Founder of Lightning Ventures noted that the secondary market has consistently been his preferred investment option, as the likelihood of an investment worth hundreds of millions going to zero is much lower compared to early-stage investments.
He added that it’s safer to get stocks from the secondary market, and just as Brian mentioned Kraken, he supported the idea that the crypto firm is a good buy as it is traded at a lower cost. Although he noted that secondary markets may have tiny margins, bear market periods, as seen today, are good opportunities “to put out a big ask up there and kind of see what happens.”
Geographical jurisdiction for investment
Further into the conversation, the host also asked the guests to talk about their preferred location for investment, and Brian revealed that his focus has been in the US because of the network and relationships he has built there.
“So I try to only invest in companies where I know the management team where I have a personal relationship with them.” This helps take away or reduce the risk of an unknown team creating any product anywhere.
Greg said that Humla Ventures has a global team without any restriction but also follows the relationship matrix. Mike added that just as Bitcoin is global, so is their business. We operate like Bitcoin, which is borderless and languageless.
Regulatory clarity regions
On the side of regulation, while Brian affirmed that his focus was in the US, he said that the lack of clarity from the SEC is a big disadvantage to the industry in the US. “It’s driving all the US innovation outside the US.”
Unlike the benefits the US got in the early days of the internet with companies such as Amazon and Google, today, job creation and tax revenue are being tampered with since the SEC has clamped down on the industry.
Mike explained that when it comes to regulations, it depends on the goal of the company. “Does it touch fiat? Does it require an MTL (Money Transmission Law) or other licenses?” For Mike, Dubai is a safer haven for crypto and Web3 companies than the US.
Regulations intensify for companies that are dealing with altcoins and not bitcoin, Greg said. The nature of Bitcoin makes it hard to have legislation around it compared to other cryptocurrencies. The Humla Staff added that Mauritius and Malta are among the regions where he has seen better clarity for the industry.
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