Apr 18, 2024

Sentiment: Bullish

Type of Trade: High Growth, Speculative

Industry: Crypto Assets

Sector: Information Technology

CRYP aims to track the performance of an index (before fees and expenses) that provides exposure to global companies at the forefront of the dynamic crypto economy.

The way to get exposure to tech and crypto at the same time will be via the fairly new fund (ASX: CRYP). Trading into CRYP offers exposure to the following items:

  1. Strong Growth Potential: The crypto economy has shown robust growth over the past decade, driven by the performance of major digital assets like Bitcoin and Ethereum. This growth trend is expected to continue, presenting significant investment opportunities.
  2. Exposure to Core Crypto Infrastructure: CRYP provides exposure to companies involved in building essential infrastructure for the crypto economy. These include manufacturers of crypto mining equipment, operators of crypto trading platforms, and other crucial service providers that support the functioning of the crypto ecosystem.
  3. Diverse Portfolio: CRYP invests in up to 50 leading companies in the crypto space, including well-known names such as Coinbase, Riot Blockchain, and Microstrategy. This diversification allows investors to spread their risk across multiple assets within the crypto sector.
  4. Convenience and Cost-effectiveness: Investing in CRYP offers a convenient and cost-effective way to gain exposure to the crypto economy. CRYP is structured as an Exchange-Traded Fund (ETF), making it easy for investors to buy and sell shares just like any other stock on the market. This familiarity and accessibility make CRYP an attractive option for investors looking to enter the crypto space without directly purchasing digital assets.

Before investing in (ASX: CRYP) take a look at the video below.

Key Facts that could give Crypto fundamental value:

✅ El Salvador made headlines by declaring bitcoin as legal tender alongside the U.S. dollar during the Bitcoin 2021 conference in Miami. While hailed by bitcoin enthusiasts, the move faced criticism from traditional institutions like the International Monetary Fund (IMF) and World Bank.

✅ The United States maintains its position as the world’s largest mining country, a title it’s unlikely to relinquish for many years. In 2021, China’s ban on bitcoin marked a significant event. After years of wavering policies, the Chinese Communist Party (CCP) imposed a comprehensive ban on bitcoin services and businesses in May. This prompted a mass exodus of bitcoin miners from China to other regions, notably Central Asia and the United States, leading to a notable surge in the U.S. bitcoin mining industry.

✅ The U.S. Federal Reserve diverged from the European Central Bank (ECB) and other central banks by refraining from condemning stablecoins and rejecting central bank digital currencies (CBDCs).

✅ Following El Salvador’s lead, other countries may consider adopting bitcoin as legal tender. Speculation abounds regarding potential adopters, with countries like Ecuador and Panama, which, like El Salvador, use the USD extensively, being prime candidates.

✅ Non-fungible tokens (NFTs) continue to gain traction across various platforms such as Ethereum, Cardano, Polygon, Hive, and EOS. NFTs enable users to engage in activities like gaming, music consumption, and token collecting. The race for blockchain dominance in NFT adoption remains undecided.

✅ Cryptocurrency stands as the fastest-growing sector globally and shows no signs of slowing down in the foreseeable future.

✅ Cryptocurrency experienced a sell-off.

✅ The launch of a Bitcoin exchange-traded fund (ETF) occurred.

✅ The Bitcoin halving event is expected to bolster the coin’s long-term value.

Why don’t’ we just buy BITCOIN then?

“The (ASX: CRYP) enables investors to access the growth potential of the crypto economy, by providing investment exposure to a portfolio of companies at the forefront of the crypto world, including crypto trading venues, crypto mining and mining equipment firms, and other companies servicing crypto-markets. (ASX: CRYP) provides ‘picks and shovels’ exposure to the companies building crypto mining equipment, crypto trading venues, and other key services that allow the crypto economy to thrive.

Although the majority of the crypto market moves along with bitcoin, these assets themselves don’t generate any type of revenue or income, while companies that are directly linked to bitcoin are prone to not only increase their holdings on bitcoin, but also generate cash flow from operational activities related to it. Microstrategy Inc. for example, is the world’s largest holder of bitcoin. This company is leveraging on capital markets in order to accumulate more bitcoin.

🚩 These companies listed within this ETF are in the technology space, the recent sell off has been putting the whole ETF fund under pressure, but we can see significant value over the medium term as we normally look forwards. There is no history of this fund since the recent inception in November 2021, but if we analyse stock by stock (the top 10 largest holdings), we will see that all of these stocks are trading at a technically discounted price as a result of the tech sell off, hence offering significant growth value from the tech space, combined to crypto exposure. not to mention the distribution compound.

Technical Analysis (ASX: CRYP)

(ASX: CRYP) has demonstrated negative growth since its inception. However, the ETF has exhibited significant swings in its unit prices, with an average above 60%. We recently engaged in trading CRYP with our VIP members, selling at a 49% profit at $5.2.

If you had purchased this ETF 52 weeks ago, you would currently be enjoying a 59% profit, largely due to the recent tech and growth rally, as well as the surge in bitcoin prices.

Ideally, we aim to enter the market when the ETF is trading at or below the long-term ascending support level, as depicted in the image below.

The following companies operates are leading companies that have exposure to blockchain and crypto assets (included on top 10).

MICROSTRATEGY = 288% in 12 months and 41% down from recent historic peak.

COINBASE = up by 235% 27% down from recent historic peak.

CLEANSPARK = up by 294% in the last 12 months and 39% down from recent peak.

GALAXY DIGITAL HOLDINGS LTD = up 112% for the year and 28% down from recent peak.

RIOT PLATFORMS 16% for the year and 56% down from recent highs. (quick note for excellent price swings on this stock)

Should we buy (ASX: CRYP) ETF?


The information provided by BG Trading to you does not constitute personal financial product advice. The information provided is of a general nature only and does not take into account your individual objectives, financial situation or needs. It should not be used, relied upon, or treated as a substitute for specific professional advice. BG trading recommends that you obtain your own independent professional advice before making any decision in relation to your particular requirements or circumstances. Past performance of any product discussed is not indicative of future performance. (We urge that caution should be exercised in assessing past performance. All financial products are subject to market forces and unpredictable events that may adversely affect their future performance).