Tokens.com Corp (COIN-NEO / SMURF-PINK) is the staking company that is perfectly positioned to ride the two biggest trends in crypto:
- Going CLEAN and GREEN as it mints Ethereum coins with 99% less electricity than mining
- The incredibly rapid growth in DeFi transaction fees—already in the tens of billions of dollars. And ETH 2.0 due out next year could dramatically increase transaction speed and staking revenue more than anyone thinks.
This is all on top of rapidly rising crypto values. TOKENS.COM has raised tens of millions of dollars and quickly bought a slew of coins that—as I’ll show you below—are up 40-124% just this quarter.
But The Big Story here is—the staking model will take over crypto, and staking revenue is already going through the roof. There are no ifs, ands or buts about it.
Tokens.com literally provides investors with a royalty on the growth of DeFi—Decentralized Finance using blockchains. It’s also a royalty on upcoming Ethereum 2.0 staking revenue.
That means that Tokens.com is going to provide investors a ride on staking revenue going from very little to $40 billion––as JP Morgan projects is coming by 2025.
Staking is the new, better version of crypto-mining. It is exponentially faster, 99% less energy intensive. I showed you yesterday what crypto-mining stocks did for investors who got in early on that trade.
Those crypto-miners are now multi-billion businesses. Early investors are rich.
Andrew Kiguel—the CEO of Tokens.com—co-founded Hut 8, which itself now has a billion-dollar ++ market cap and is one of the largest crypto-miners in the business. It ran from $1 – $16 this year already!!!
Kiguel hit a $2 billion-dollar homerun with Hut 8 for himself and shareholders—but as he explained to me—he is even more excited about Tokens.com. Because staking is a much, much better business than crypto-mining.
Let me show you why….
The Tokens.com Staking Business Model
Is A Thing Of Beauty
The beauty of staking is that it requires almost no capital investment. Actually, it requires virtually no ongoing operating expense either.
That means fast payback and high profit margins.
Crypto-mining requires spending on hardware and electricity. But all that a staking company does is allocate that same capital into (mostly ETHEREUM) tokens that immediately start generating staking revenue—and then never stop generating revenue.
Staking revenue is passive for the token owner. To earn that staking revenue all that you need to do is be willing to set aside a certain amount of tokens and allow the blockchain technology to put your tokens to validation work.
For doing nothing, the token owner like Tokens.com gets paid. The payment is in the form of even more tokens—and they can re-stake those tokens to generate a very impressive compounded return!
With staking those tokens are the gift that just keeps on giving—24 hours a day, 7 days a week, 365 days a year. The digital tokens that Tokens.com owns will be continually generate income for the company and the shareholders.
So there is actual revenue generation in staking. You can cash that out and pay it to shareholders, or leave it in tokens for future capital gains there.
BLOCKCHAIN DE-FI CAN
INCREASE CRYPTO PRICES AND REDUCE VOLATILITY
Through Ethereum and other protocols or networks, Tokens.com is also tied directly to the growth in DeFi (Decentralized Finance).
DeFi is itself a Mega-Trend that I think could greatly reduce volatility in crypto pricing.
DeFi allows users to trade assets and borrow and lend directly to one another without involving banks, and also acts as a means to creatively unlock value – for payments, loans, insurance and more.
I think global DeFi transaction fees could potentially be worth hundreds of billions of dollars a year by the end of this decade. As the system proves itself over time it will attract much more institutional capital who want to increase their meager 1-2% bank deposits.
Right now there is enough transaction fee revenue to be shared with stakers that it’s very normal to see 5-10% yields. Longer term institutional capital could bid up crypto prices so that they generate a steady 2-4% yield across the board—reducing the speculative price cycle.
And ETH 2.0 has the potential to massively increase the number of DeFi transactions and revenue generated (which means higher staking fees!!!)
So when I see crypto prices stabilizing—I see them higher than here just based on yield. Remember, a lower yield means a higher priced asset.
And crypto prices are SOARING now. Here is a list of tokens that TOKENS.COM owns, and how much they went up in Q3 (ending Sept 30)
Bitcoin up 40.7%
BNB (Binance Coin) up 62.4%
DOT (PolkaDot) up 99.3%
ETH (Ethereum) up 52.4%
ROSE (Oasis Network) up 124%
The business model is both absurdly capital/asset-light, and scalable to an unlimited extent.
I just described the Tokens.com business model to my wife as being a snowball that is just starting to roll down a wet, sticky, hill. The company’s tokens earn staking revenue, which results in the company receiving more tokens that then also start earning more staking revenue.
The snowball of revenue generating tokens that the company owns just keeps getting bigger and the revenue that it generates gets bigger along with it.
The business model is basically the power of compound interest brought to life!
Tokens.com Is The Only Public Company
With A Focus On Staking
I love the business model, but I have to admit that I’m even more exciting about owning this stock before the momentum money and crypto crowd figure this out.
Once those crypto/momo folks get excited about something they are willing to drive market prices to insane levels. Just look at those crypto-mining stock prices….
That hungry crowd will love this stock.
- COIN has a tiny $35 million market cap,
- they already won big with the CEO who built them a billion-dollar crypto miner and
- this is the only way that they can play staking.
Fundamentally what investors also really need to focus on is the fact that through staking Tokens.com is going to be tied at the hip to Ethereum–– which has established itself as the most actively used blockchain network.
Staking is SO MUCH BETTER Than Mining
CEO Kiguel built a billion-dollar-plus crypto miner. The management group at Tokens.com own 35% of the shares and are heavily incentivized to build something big again.
Crypto-miners attracted billions of dollars from investors. I see them moving to crypto-stakers like Tokens.com—it’s a similar service without the huge capex and vast amount of energy use.
That means a fraction of the operating cost and none of the up-front capex!
And it’s more lucrative!
This business is just compound interest brought to life. The company owns tokens which earn staking revenue for validating blockchain, that revenue turns into more tokens and then the process repeats.
Tokens.com is already staking. The business is generating positive EBITDA and growing daily.
That staking cash cow that has started will now be generating staking revenue 24/7, 365 days of the year forever into the future.
The more Ethereum that Tokens.com owns, the more fees they generate. They can keep compounding that revenue—or they could eventually distribute a portion of this high margin income to shareholders.
The majority of Tokens.com capital will be deployed into Ethereum which is the blue-chip staking play––––but Kiguel will use his expertise to back some earlier stage DeFi ventures, where the potential for profit is exponential (see how he owns ROSE and DOT).
That provides some moonshot/lottery ticker upside on top of what Ethereum staking offers.
I’m really bullish on staking but management is always the most valuable commodity.
Kiguel’s track record at crypto miner HUT 8 Mining, which went from 50 cents to $16; a billion-dollar market valuation—has me chomping at the bet to see what he can do starting with a $35 million market cap but higher profit margin staking business.
The timing is perfect with Ethereum 2.0 right around the corner ready to exponentially increase the staking revenue available to claim.
How long can it be until Bitcoin follows suit and makes the transition to the 99% less energy intensive and exponentially faster Proof-of-Stake model?
I’M LONG TOKENS.COM!!!
TOKENS.COM has reviewed and sponsored this article. The information in this newsletter does not constitute an offer to sell or a solicitation of an offer to buy any securities of a corporation or entity, including U.S. Traded Securities or U.S. Quoted Securities, in the United States or to U.S. Persons. Securities may not be offered or sold in the United States except in compliance with the registration requirements of the Securities Act and applicable U.S. state securities laws or pursuant to an exemption therefrom. Any public offering of securities in the United States may only be made by means of a prospectus containing detailed information about the corporation or entity and its management as well as financial statements. No securities regulatory authority in the United States has either approved or disapproved of the contents of any newsletter.
Keith Schaefer is not registered with the United States Securities and Exchange Commission (the “SEC”): as a “broker-dealer” under the Exchange Act, as an “investment adviser” under the Investment Advisers Act of 1940, or in any other capacity. He is also not registered with any state securities commission or authority as a broker-dealer or investment advisor or in any other capacity.