CoinShares posts record earnings in Q1, boosted by markets, Bitcoin ETFs

European asset manager CoinShares posted a record performance in the first quarter of 2024, driven by a recovery in markets since the launch of Bitcoin exchange-traded funds (ETFs).

The company reported revenue of 19.5 million pounds ($24.5 million) in the period, a 216 percent increase compared to the first quarter of 2023. Profit and other income totaled 24.4 million pounds ($30.6 million).

Earnings before interest, tax, depreciation and amortization (EBITDA) reached 34.2 million pounds ($43 million), up 7 million pounds ($8.8 million) from the previous year, a four-fold increase.

According to CoinShares chief financial officer Richard Nash, the EBITDA margin for the quarter was 78 percent. This margin is starting to return to the levels we reached in 2021.

Approximately 45% of CoinShares' gross profit and other income comes from its asset management business, 40% from capital markets and the remaining 15% from the company's core investment portfolio, Nash explained.

The company spent a total of 19.5 million pounds ($24.5 million) in management fees, the second highest after charges recorded in the fourth quarter of 2021.

Purchase of Valkyrie

CoinShares optioned to acquire the Valkyrie Fund on January 12 following the US Securities and Exchange Commission's approval of Bitcoin (BTC) ETFs.

The acquisition includes sponsorship rights to several similar products, including Valkyrie's spot Bitcoin ETF, investment advisory business Valkyrie Investments and Valkyrie Bitcoin Miners and Valkyrie Bitcoin Futures Leveraged Strategy ETFs.

The agreement was signed in It ended on March 12. According to CoinShares, the acquisition added about 1.6 million pounds ($2 million) of goodwill to its balance sheet, an accounting term that represents intangible assets at the time of acquisition.

In the year CoinShares' total assets under management as of March 31 were 4.77 billion pounds ($6 billion). “The AUM figure increased 58% from the end of 2023 due to the performance of the broader industry in Q1 2024 in conjunction with the acquisition of Valkyrie, which saw significant price increases across the board,” reads the earnings report.

According to CoinShares CEO Jean-Marie Mognetti, the acquisition of Valkyrie is in line with plans to become a leading global investment company focused on digital assets. “The US market accounts for 50% of global assets under management and provides CoinShares with a unique opportunity for growth.”

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