The Canadian stock exchanges are set to welcome at least 50 firms related to blockchain and cryptocurrencies. The market is junior in nature and more comfortable with risks than other parts of the world. According to CEO of GMP Capital Inc Harris Fricker in an interview with Bloomberg.
The market system was more inclined towards miners and oil and gas companies in the past. Since it is now welcoming new non-ordinary players. At the moment, eight cryptocurrency-related stocks are now trading in the Canadian market. Besides, the market value for Marijuana industry is now over C$17 billion ($13 billion) ahead of recreational legalization in July.
“The junior exchange, typically, and the independent broker-dealers have funded the marijuana space. We now have 10 world-class companies in that space. I think Blockchain will be 10 times the size of the medical marijuana space”.
The Canadian market is also witnessing the effect of high-quality teams and high expertise in cryptocurrencies and business in the market and there is the fact that the capital market ecosystem is friendlier to small companies especially on the TSX Venture Exchange, he said.
“You have a viable system for listing and getting capital for companies, you are involving accredited investors — there’s no pitching of this to the retired people of Canada — and there’s a proper weighting of risk and opportunity,” said Fricker
GMP Capital helps firms in the emerging industry in the cryptocurrency scenes. It has a dedicated blockchain team comprising of eight investment bankers and two research analysts. The company also hosts blockchain conferences including an upcoming one in Toronto.
For instance, it is helping Hut 8 Mining Corp., which is working with Bitfury Group in a deal that could see it run the biggest cryptocurrency mining data center in North America according to the latest announcement.
Fricker became interested in blockchain due to his interest in cryptography. He is optimistic that blockchain industry will exceed medical marijuana industry.
Many companies are likely to go public by acquiring existing listed companies instead of doing initial public offerings. The market also allows companies to list through reverse takeover structure where the company does not have to file a prospectus with regulators or woo investors through the sale of stock. This has been going on for many years in Canada.
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For instance, Vancouver-based Hive Blockchain Technologies Inc. listed on the TSX Venture Exchange through a reverse takeover. It started trading this September and its value is up by more than 200 percent. Hence, it has a market value of about C$824 million, making it the nation’s largest blockchain company. It might serve as an inspiration to many cryptocurrency companies willing to list on the exchanges in future.
“The reverse takeover structure will prevail for now until the regulators provide full instruction on where they live on a clearing of prospectuses”.
Canada is a good source of leaders or influential people in crypto scenes, especially from the University of Toronto and the University of Waterloo where Russian-Canadian Vitalik Buterin dropped out of before introducing Ethereum to the world in 2013.
Fricker believes that Bitcoin has a good future despite the latest claims that it is a bubble due to the huge price increase and volatility.
“I believe that Bitcoin is a rapidly emerging new asset class,” he said. “All Bitcoin does is it makes mathematics the central bank governor.”