Wonderfi Technologies, Inc. (OTCQB: WONDF) (TSX: WNDR) is a Canadian digital asset technology company, which owns and operates the registered crypto trading platforms Bitbuy and Coinberry. Bitbuy holds the distinction of being Canada’s first fully-registered crypto platform, which has over 400,000 registered users, according to the company. U.S.-listed shares of the Canadian crypto trading platform are climbing 43% through early trading on Monday, April 3, 2023. Over the past thirty days, Wonderfi has seen an average daily volume of 170,317 shares. However, volume of 809,734 shares, or dollar volume of around $133,768, has already exchanged hands through early trading.
Shares of Wonderfi are rallying after the company announced it has entered into a business combination agreement with Coinsquare, Ltd. and CoinSmart Financial, Inc. (NEO: SMRT), to create Canada’s largest regulated crypto and digital asset trading platform. The combined company will offer Canadians a wide range of capabilities, such as retail & institutional trading, staking, crypto payment processing, and more. Sports betting, iGaming, and fractional stock trading are a few additional features that the combined entity plans to pursue.
The combined company will hold a registered user count of over 1.65 million Canadians and hold over C$600 million worth of assets under custody. Since 2017, the combined company has processed over C$17 billion in cryptocurrency and digital asset transactions. Together, the new entity is estimated to hold total cash and cash equivalents of around C$50 million and no debt. During the fiscal year 2022, Wonderfi, Coinsquare, and CoinSmart generated total revenues of C$37 million.
Under the terms of the transaction, Wonderfi plans to issue 269,727,080 common shares to Coinsquare and 119,181,733 common shares to CoinSmart. Upon closing of the transaction, Wonderfi will own 38% of the combined company, Coinsquare will hold 43% and CoinSmart will own 19%, all on a partially diluted basis. The deal still requires the necessary shareholder and regulatory approvals before the transaction can be finalized. Overall, the three companies estimate the transaction to close sometime during the second quarter of 2023.
“At the heart of all great innovation is a consumer that is driven to adopt new technology to improve their personal or professional lives. WonderFi has always been dedicated to bringing the best and most relevant products for our users to market. What we will deliver with the combination of both Coinsquare and CoinSmart is a unique platform where users will trade, earn and pay with crypto, invest in equities, and soon, place wagers all in one compliant ecosystem,” said WonderFi President and Interim CEO, Dean Skurka. “With this combination, we have the scale to be the market leader in Canada, a strong balance sheet that will allow for expansion, and a clear path to profitability.”
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