Author: Gus Richler, The Deep Dive.
The activity and press releases coming out of Washington over cryptocurrencies points to a new normal. Cryptocurrencies are a real thing, what with the creation of both the Strategic Bitcoin Reserve and the US Digital Asset Stockpile. The legitimacy and strategic value of cryptocurrency is now being pushed both by the governing GOP and the new President (and of course, his family).
Spirit Blockchain (CSE:SPIR) had the foresight to plan ahead. They are the only company in the public markets focused solely on tokenization and digital asset management. Sure, other companies may also want to HODL, but what one must consider: what is the actual use case for their holdings?
In essence, Spirit Blockchain is fast becoming a de facto international institutional bank (no checking accounts!), one aiming to be first in class in the ability to stake, attain yield, and earn royalties. By doing so, they are building a safe and well-rounded monetization vehicle for the use of blockchain.
Scaling Assets Under Management
So, what is Spirit Blockchain’s end-game? That their actions will make them a quite attractive destination for individual and institutional monies that want exposure to an institutional-grade entity in which to hold their crypto assets.
Spirit is also taking a digital asset focus – and building their own blockchain. This is one of the building blocks Spirit is looking at in order to attract smart capital that is looking for optionality in their crypto investment choices.
The company last week announced a key partnership to this end, with the company entering an arrangement with Astralane, a Canadian-based leader in web3 infrastructure.
Spirit’s New Partnership…Simplified
If one is new to crypto, or only has a simple understanding on the subject, the depth of this development can be daunting. So, let’s take a look at the key highlights of this new partnership and its take-aways.
Spirit is launching an exchange traded product based on a Staked Solana Index, providing passive Solana exposure and up to an 11% annual percentage yield using Astralane’s ‘validator.’
So, you are locking up your crypto currency (it’s “passive”) in a staking wallet and by doing so help the network validate transactions. And as such you are paid extra (the APY) for doing so.
For context, a crypto validator is a participant in a blockchain network responsible for verifying and validating transactions. A staking wallet allows you to stake your cryptocurrency to participate in proof of stake (PoS) or other staking-based blockchain networks.
When you stake your crypto, you are essentially locking it in a wallet to help secure the network and validate transactions. In return, you earn rewards or interest.
So, how do you make money from the Staked SOL Index/ETP?
Passive Income + APY (Up to 11%) = Client Total Return
Smart Risk Management
In planning and building his venture, Spirit’s CEO, Lewis Bateman, is using risk management in the very best sense. Using a combination of Solana (SOL), DOGECoin (DOGE), and EOS assets makes for a diversified crypto treasury solution. This makes for a combination of crypto – with Spirit smartly not putting all their eggs in one basket. This is part of their “comprehensive treasury management.”
Bateman and his team have used “institutional grade standards.” Looking at the big picture, one cannot compromise. He and his top-shelf team are aiming for “reliability, security, liquidity and compliance.”
In bringing in Astralane’s co-founder as an Advisor, Spirit is demonstrably bringing in crypto experts who help make their solutions rock-solid.
Spirit is also laying the foundations for a “comprehensive tokenization platform” leveraging blockchain efficiencies. In essence, with Spirit, businesses and financial institutions can now convert assets with into digital tokens, enabling safe fractional ownership.
Future growth now includes more yield bearing digital assets solutions, and other expanded offerings.
In Summary
When looking at all of Spirit Blockchains recent news activity, one needs to ask three questions: What does it look like Spirit is building? How do they make money? And what is the growth potential?
It can definitely be argued that those three questions are now being answered in short order. Furthermore, they are building an infrastructure, narrative and brand that is torqued to attract large sophisticated crypto allocators
All in all, in a complicated landscape, they make money in a clean and simple fashion. And Spirit can attract capital from anywhere by being designed to scale.
In summary, Spirit Blockchain Capital’s strategic initiatives and diversified asset exposure position it well to capitalize on the increasing institutionalization of digital assets. They want to be the desired home for sophisticated pools of capital from across the globe wanting the safest and smartest exposure to crypto.
FULL DISCLOSURE: Spirit Blockchain is a client of Canacom Group, the parent company of The Deep Dive. Canacom Group is currently long the equity of Spirit Blockchain. The author has been compensated to cover Spirit Blockchain on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. We may buy or sell securities in the company at any time. Always do additional research and consult a professional before purchasing a security.
This is third-party provided content issued on behalf of Spirit Blockchain Capital Inc., please see full disclaimer here.
