Listing through reverse takeover
January 11th, Arcane Crypto (Arcane) became a publicly listet company on Nasdaq First North Stockholm. This happened though a reverse takeover of the already existing Vertical Ventures AB. There is a new ticker; ARCANE – and our CEO, Torbjørn Bull Jenssen has rung the bell. Arcane is a nordic tech company that is 100% invested in the growth of cryptocurrency. The goal is to become a European crypto-powerhouse.
As I will explain in this article, the company has an exciting strategy that stands out from a lot of other companies in its sector.
Arcane Crypto has acquired a portfolio of eight different companies and business units that offer infrastructure or products related to cryptocurrency. In this sense, Arcane is almost a listed venture company. This means that you, if you for example invest your savings in stocks, can participate in the value development of the underlying companies and business units from the time they are young and small until they become large adults.
Those types of investments have typically been reserved for people who “know someone” or very wealthy investors. At the same time, the combination of these types of investments also indicates that Arcane have the possibility to aim for a position on international payments, based on crypto technology and infrastructure.
What does Arcane own today?
Arcane Crypto owns, or partly owns, companies operating in: Payment services (Teslacoil 100%), fund management (Arcane Assets, 100%), two crypto exchanges (Trijo, 34% Sweden and Kaupang Krypto 100%, Norway), a crypto derivatives market (LN Markets, 7.X%), a market maker (Alphaplate, 45%), an interbank market (Pure Digital 35%) and a media & research department (Arcane Media / Arcane Research 100%). You can read about the company portfolio on the Arcane Crypto website.
As an example, we can focus on Teslacoil and Pure Digital;
Teslacoil is a software that acts as a payment solution for fast and cheap transfers of fiat currency using Bitcoin’s lightning protocol. Put simply: Businesses can use Teslacoil to receive bitcoin payments over lightning and end up with Euros in their account. Consumers will, in turn, be able to send bitcoin payments, using lightning, directly from their bank account on crypto exchanges that have instant payment and Teslacoil integration (or another form of Lightning integration). While companies can run the Teslacoil software all by themselves, consumers will be able to access it through regulated exchange platforms such as Arcane owned Kaupang Krypto.
The result is that you can exchange Norwegian kroner(NOK) to USD, in less than a second and at a cost far below what traditional players can deliver. Corresponding payments in the current banking system typically cost NOK 50-100 plus 1-3 percent, and can quickly take three days, if not more. By going via Lightning, it will be fast and cheap.
Best of all, you as a customer will most likely do not have to think about which payment rail is used, you can just be confident on the fact that the money arrives a second after you have pressed send.
Pure Digital is building an interbank market for cryptocurrency trading, based in London. Banks like Morgan Stanley, HSBC, Nomura, Goldman Sachs and DNB will, as I see it, eventually trade cryptocurrencies, and they will not do so on obscure stock exchanges in tax havens. They will want to trade with each other, as they do with interest rates, bonds, fiat currencies, etc. Pure Digital is building such a market for the world’s largest banks, the so-called Tier 1 banks. This means that they can trade bilaterally, use the lines of credit they already have on each other, and choose who they are willing to trade with. Pure was founded by the former founder of Par FX and is experiencing great interest from both banks and others.
Initially, I explained how Arcane Crypto may be a bit reminiscent of a venture fund, but which is listed. That’s just half the story. Arcane’s portfolio provides an exciting exposure, and the width provides increased robustness, but it also provides something more: the opportunity to take advantage of synergies.
In traditional finance, you often find many different services under one roof: Payment, investment, trading, analysis etc. The reason is simple: there are economies of scale and synergies of gathering various related services. In the cryptocurrency sector, the market has, so far, been much more fragmented. Arcane sees this as an opportunity. By building a portfolio and taking an active role related to M&A in the future, the goal is to build a platform that can function as a one-stop-shop for financial services related to cryptocurrency. As previously mentioned, a crypto powerhouse.
By being ahead of its time, Arcane Crypto has managed to become a hub in northern Europe with an international footprint when it comes to cryptocurrency. This means that the deal flow is very good. Arcane is a partner many want to talk to, and makes us get into attractive deals early.
Disclaimer: Kryptografen is 100% owned and managed by Arcane Crypto