The world of cryptocurrencies and crypto related stocks continue to advance at full speed. It would be an understatement to say the demand is off the charts, considering the market cap of all cryptocurrencies is almost $2 Trillion. Yes, $2 Trillion, with a T (according to CoinMarketCap). As a result, this is by far the most exciting time for the crypto space, as cryptocurrencies hit new all time highs and new companies emerge/go public. Only yesterday, we wrote about Coinbase’s plans to offer shares via direct listing. Bullish…Which brings us to the Etoro SPAC Merger! Today we analyze the details of the merger and make a prediction. Check it out below!
Etoro SPAC Merger Details
Another day, another crypto company comes closer to going public. This list continues to grow, along with the interest in the next generation of online money.
And guess who is profiting bigly off this trend?
eToro. (and many others).
Thankfully, you can be part of the profit train as more and more companies go public. Starting with Etoro’s latest announcement to merge with FinTech Acquisition Corp. V.
First, let’s go over the big picture details.
According to the Etoro’s Press Release:
NEW YORK, NY, March 16, 2021 – eToro Group Ltd. (“eToro” or the “Company”), a multi-asset investment platform that empowers people to grow their knowledge and wealth as part of a global community of successful investors, and FinTech Acquisition Corp. V (NASDAQ: FTCV) (“FinTech V”), a publicly-traded special purpose acquisition company, announced today that they have entered into a definitive business combination agreement. Upon closing of the transaction, the combined company will operate as eToro Group Ltd. and is expected to be listed on NASDAQ.
Let’s be honest, we love crypto companies. Most do not know, but one of the biggest trades of the past 12 months is RIOT and MARA. These two are up several thousand percent from the March lows of 2020. We have been writing about them for almost the entire time. You can read about them here.
Will the next wave of crypto stocks offer the same level of returns?
Only time will tell!
No need to go in depth through the entire release, it is quite complex. You can read the full presentation here.
Instead, here are some highlights and some summary points:
- Company expected to have an estimated implied equity value of approximately $10.4 billion
- Global multi-asset investment platform capitalizing on secular trends: rise of digital wealth platforms, growing retail participation, and mainstream crypto adoption
- In 2020, eToro added over 5 million new registered users and generated gross revenues of $605 million
- Added over 1.2 million new registered users and executed more than 75 million trades in January 2021 alone
- Transaction includes commitments for a $650 million common share private placement from leading investors including ION Investment Group, Softbank Vision Fund 2, Third Point LLC, Fidelity Management & Research Company LLC, and Wellington Management.
- Investor call scheduled for March 16, 2021 at 8:00 AM Eastern
Next, let’s see if we can summarize.
eToro is going public via SPAC merger with FTCV at an implied valuation of ~$10B. Massive user growth and exponential growth in crypto trading. Finally, big shot bankers will take care of the entire transaction.
Simple enough…and very bullish, of course.
Finally, onto the prediction!
Etoro Stock Prediction
Full disclosure, making a prediction on cryptocurrencies and crypto related stocks is a total crapshoot. This industry is extremely volatile and unpredictable…except for the past year, which has just been an exponential parabola.
Realistically, there is no way to tell when this train stops. If you look at the chart, Bitcoin has been hovering in one spot around the $56-60k for weeks now. That is generally very bullish, considering it can barely get below the 20dma.
Thankfully, we live by a simple rule: “Bears win battles, bulls win wars”
Essentially, this means that remaining positive and bullish will generally yield more profits than staying negative and bearish.
So, for this prediction, let’s stay in the bullish mindset and make an assumption that the crypto bubble will continue to advance until acted upon by an outside force. The hype is real, as you can tell by the parabola charts of individual cryptocurrencies and crypto stocks.
Conclusion and eToro Price Target Prediction
Therefore, we will assume no change in the crypto momentum upon eToro’s public listing.
If this is the case, eToro will have a very positive IPO launch.
In fact, if you are trying to catch this pump, right now is probably the best chance you are going to get.
FTCV stock, the SPAC chosen for the merger is near the all time lows, currently hovering around $11. In the world of SPACs, this is probably the lowest price you will get. Possibly $10 if you are lucky.
And, if you read the fine print…eToro has an implied valuation of $10B…
This is almost 30x from current valuation of FTCV, which is hovering around $370M. If the valuation metrics are implemented, this might be an absolutely ABSURD monster run.
Just judging from the EV SPAC run a few months ago, this is a very likely possibility.
As a result, we are putting a very conservative $50 price target going into the merger. Read that again…GOING INTO THE MERGER. NOT AFTER. We have been warning many times over that the most pernicious time to enter or stay in the pump is UPON THE ANNOUNCEMENT of the merger.
Therefore, this can go either way. Pump into announcement, dump after or dump into announcement, pump after.
Regardless, the best time to get in is NOW!
Conclusively, $50 is our low level price target, this could even get up to $100+. Yes $100 USD+, which is about 1000% return on your investment.
Again, this depends on the strength of the crypto market, the lack of fraudulent activity, etc.
LETS GO CRYPTO BULLS!!!!
What do you think? Mega parabola or dump on deck? Tell us in the comments!
Stay tuned, we will undoubtedly be following and covering the eToro SPAC merger for the foreseeable future!!!
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