- KAOS Capital, a Miami-based hedge fund manager focused on venture capital and activist investing, and a major shareholder in WonderFi Technologies, intends to propose five nominations to the crypto stock’s board ahead of the annual general meeting on May 21
- KAOS’s move stems from dissatisfaction with WonderFi’s stock performance, considering its leadership position as the only fully regulated crypto exchange in Canada
- WonderFi Technologies owns and operates Bitbuy and Coinsquare, two leading Canadian cryptocurrency platforms, with more than 1.6 million registered users and more than C$1.5 billion in assets under custody combined
- WonderFi stock has added 90.62 per cent year-over-year, but has lost 53.08 per cent since June 2022
KAOS Capital, a Miami-based hedge fund manager focused on venture capital and activist investing, and a major shareholder in WonderFi Technologies (TSX:WNDR), intends to propose five nominations to the crypto stock’s board ahead of the annual general meeting on May 21.
KAOS’s move stems from dissatisfaction with WonderFi’s stock performance and what Wednesday’s news release describes as a “failure to capitalize on its position as the only fully regulated crypto exchange in Canada.” For context, WonderFi shares have added 90.62 per cent year-over-year, but have lost 53.08 per cent since June 2022, while Bitcoin has gained 159.32 per cent and 247.27 per cent, respectively.
The release expands upon this failure by citing a lack of product strategy, fragmented brand positioning, and significant impairments from past acquisitions, which have led to the departure of numerous executives, including a chief executive officer, two chief financial officers, a chief strategy officer, and multiple directors, ultimately causing the stock to trade “far below its true intrinsic value.”
The hedge fund manager’s call for change is supported by shareholders representing approximately 22 per cent of WonderFi’s issued and outstanding shares, including a voting agreement with Mogo (TSX:MOGO), the crypto stock’s largest shareholder at 13 per cent.
If KAOS’s plan comes to fruition, new leadership will be positioned to unlock significant upside potential within the ongoing crypto bull market.
Management insights
“As the cryptocurrency market rebounds, WonderFi is uniquely positioned to leverage its position as the only fully regulated crypto exchange in Canada,” Adam Arviv, KAOS Capital’s founder and chief executive officer, said in a statement. “Strong leadership is imperative to capitalizing on this opportunity and the current board has not shown itself to be capable or engaged enough to lead the way. Rather than engaging constructively and identifying a path forward, the current board has taken the approach of stonewalling its shareholders. A proxy contest was not our first choice but unfortunately is now required if shareholder value is to be protected and enhanced.”
“This need for new leadership has already been identified by a large proportion of shareholders and every day more shareholders are joining our call for change,” Arviv added. “I encourage the board not to waste more company resources and to participate in an orderly transition, given that change is inevitable.”
About WonderFi
WonderFi Technologies owns and operates Bitbuy and Coinsquare, two leading Canadian cryptocurrency platforms, which serve more than 1.6 million registered users and hold more than C$1.5 billion in assets under custody combined. The crypto stock is also active internationally through its acquisition of FX Institutions, an Australian crypto trading and remittance provider, as well as through Smartpay, its global crypto payments platform.
WonderFi stock (TSX:WNDR) last traded at C$0.30 per share.
Join the discussion: Learn what other investors are saying about this crypto stock and its activist investor on the WonderFi Technologies Bullboard, and check out Stockhouse’s stock forums and message boards.
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