July 11, 2021 : Strong VC activity in H1 2021, regulatory overhang on US listed Chinese equities

A lot of attention this week focused on US listed Chinese equities, which have collectively lost nearly a trillion dollars of value as recent regulatory uncertainty clouds these stocks. In North America, Toronto and US startups hit records for VC funding in H1/2021 – in both cases, six month activity nearly matched all of 2020. Payments firm, Stripe could be taking its first steps to its public markets debut, while European fintech Wise, direct listed in London, and Nextdoor and Planet Labs are going public in the US via the SPAC route. Sophic Capital client Real Luck Group (LUCK-TSXV, LUKEF-OTC) is poised to become a dominant esports betting service. CEO Thomas Rosander is hosting an investor update on Monday, July 19 at noon EST / 9am PST. To learn more, please register HERE. Investors are encouraged to submit their questions via email at All@SophicCapital.com. Another Sophic client, Swarmio (Private) is aiming to go public on Canadian Securities Exchange as indicated in Canadian tech blog Betakit.

Clearco secures $268 million in round led by SoftBank. 

Clearco has secured $268 million in a new round of equity capital led by SoftBank Vision Fund 2. The round, which comes mere months after Clearco raised $125 million of equity financing, accelerates the company’s international expansion plans and overall roadmap by at least one year. The investment marks the first SoftBank has made in a Canadian company through its Vision Funds. The round was made up of entirely new investors, as it also included Intuit, Bow Capital, and Park West. Clearco declined to disclose the amount of secondary capital involved in the round. https://bit.ly/3hrQVig

Swarmio (Private, Sophic Client) aiming to go public on Canadian Securities Exchange.

Halifax-based video game tech startup Swarmio Media revealed it intends to go public on the Canadian Securities Exchange (CSE), in a June 25 filing. The company doesn’t plan to sell or issue any new securities in connection with the move, which was first reported by Private Capital Journal. Instead, according to Swarmio’s non-offering preliminary prospectus, the startup has created a new holding company, Swarmio Media Holdings, which secured $5 million in gross proceeds through a June private placement. https://bit.ly/3htv0aM

LifeSpeak goes public on TSX, closes $125 million public offering.

Toronto-based employee wellness software company LifeSpeak began trading on the Toronto Stock Exchange Tuesday, after closing a previously announced $90 million initial public offering (IPO) and a $35 million secondary offering. LifeSpeak issued nine million common shares at a price of $10 per share, securing total gross proceeds of $90 million. Through an accompanying secondary offering, a group of LifeSpeak shareholders, including founder and CEO Michael Held and Toronto’s Round13 Capital, sold an aggregate of 3.5 million common shares at $10 per share, for total gross proceeds of $35 million. https://bit.ly/2UyKG3v

VerticalScope increases IPO to nearly US$144 million following exercise of over-allotment. 

VerticalScope, which went public on the Toronto Stock Exchange (TSX) a few weeks ago, has boosted the total size of its initial public offering by nearly $18.8 million, after the deal’s underwriters exercised their over-allotment option in full. The IPO’s underwriters have purchased over 850,000 additional subordinate voting shares at the offering price of $22 per share. The exercise of this option, combined with VerticalScope’s initial $125 million IPO, brings the company’s aggregate gross proceeds to about $143.8 million. https://bit.ly/2SZZ9oG

WeCommerce closes $33.7 million bought deal financing to acquire more Shopify ecosystem companies.

Victoria-based holding company WeCommerce has secured about $33.7 million in funding following the close of a previously announced bought deal financing. WeCommerce issued 2.81 million class A common shares at a price of $12 per share, giving the firm around $33.7 million in gross proceeds. This total included 310,000 shares issued related to a partial exercise of an over-allotment option. The British Columbian holding company, which aims to build, grow, acquire businesses that serve Shopify ecosystem, plans to use the net proceeds from the offering to fund strategic acquisitions and for working capital. https://bit.ly/3jXH6ub

Call centre software provider ReadyMode secures $4 million in venture debt.

ReadyMode, which provides call centre software, has secured $4 million in venture debt to scale its cloud-based platform and keep up with the changing demands of the call centre industry. The funding comes from Scotiabank’s Technology and Innovation Banking arm as ReadyMode sees an opportunity to take advantage of changes in the contact centre software market, driven, in part, by increasing adoption of virtual and cloud-based solutions throughout COVID-19. https://bit.ly/3yzo29D

Tetra Trust to become Canada’s first qualified crypto custodian, raises funding from Coinbase, Mogo.

Calgary-based FinTech startup Tetra Trust said it has received regulatory approval from the Government of Alberta to store cryptocurrency assets, which it claims makes the company “Canada’s first qualified custodian” of cryptocurrency. Tetra said it received its certificate of registration from Alberta on July 5. At the same time, the startup announced it has raised an undisclosed amount of strategic financing from Coinbase Ventures, Mogo, the Canadian Securities Exchange, Coinsquare, Urbana Corporation, and the Caldwell Growth Opportunities Fund. Founded in 2019, Tetra’s core business involves the custody and storage of crypto assets like Bitcoin and Ether. Tetra aims to help crypto service providers, investors, and fiduciaries mitigate the risk of theft and loss. The startup said that, prior to its launch, “the Canadian market for cryptocurrency custody was limited to US providers and unregulated Canadian custodians.” The regulatory approval from Alberta would enable Tetra to provide crypto custody services to institutional investors. Tetra estimates the current market for crypto custodial services is “in the tens of billions of dollars.” The startup aims to have more than a billion dollars’ worth of assets under management by the end of 2021. https://bit.ly/2UFkJ2h 

Toronto venture funding in Q1 2021 nearly matched all dollars raised across 2020. 

Tech startups in the Greater Toronto Area (GTA) raised more than $1 billion in venture funding over the first quarter of this year, nearly matching the dollars raised in the region across all of 2020, according to Hockeystick’s latest ecosystem report. Overall, Toronto-based startups raised $1.15 billion through 81 deals in Q1 2021. The funding represents a colossal 373 percent increase in total investment compared to the fourth quarter of 2020, and a nearly 200 percent increase year-over-year. The GTA’s funding performance also represents the first time investment has surpassed the $1 billion mark in at least the last year. https://bit.ly/2TF8imZ

Ontario government establishes new igaming division.

iGaming Ontario will operate as a subsidiary of the state’s Alcohol and Gaming Commission of Ontario (AGCO) and ensure new measures are put in place to protect Ontario consumers from gambling-related harm. The government first announced plans for a dedicated subsidiary last year, with Ontario expecting to open its new online gambling market in December this year. “Ontario’s new legal igaming market will create new opportunities for Ontario businesses and a better, safer gaming experience for players,” Finance Minister Peter Bethlenfalvy said. Formation of the new subsidiary comes after a bill to legalize single-event sports betting in Canada last week secured Royal Assent and will pass into law once the country’s House of Commons has been advised. Bill C-218, also known as the Safe and Regulated Sports Betting Act, repeals paragraph 207(4)(b) of Canada’s Criminal Code, under which consumers are only permitted to wager on at least three games or more, meaning that a bet on a single match or event is deemed illegal. https://bit.ly/3xBtkS3

Uber and Lyft could be avoiding $135 million in Canadian taxes every year by relying on contract workers, report says.

Uber and Lyft could be avoiding a combined $135 million in taxes every year in Canada, according to a new report from the nonprofit Canadians for Tax Fairness (C4TF). The report estimated Uber and Lyft avoid $53.9 million in corporate taxes as well as $81.3 million in unemployment insurance and benefits taxes by taking advantage of lax financial disclosure requirements around corporate taxes, in addition to classifying drivers as contractors. While not illegal, the tactics let Uber and Lyft benefit from taxpayer-funded programs like roads, pensions, and unemployment insurance, despite paying very little into those programs, C4TF argued. https://bit.ly/3yzBXg3

U.S. startups raise record US$140 billion.

Startups headquartered in the U.S. raised a record US$140 billion in venture funding in the first half of the year, according to new data from Ernst & Young. That’s 91% of the US$153 billion raised in all of last year. Global VC investment in the first half of the year also beat records, reaching US$288 billion in the six-month period or US$110 billion more than the total raised in the last six months of 2020, according to research firm Crunchbase. Fueling the record-breaking investment levels are mega-financing rounds at higher-than-ever valuations. So far this year, 250 companies have become “unicorns,“ meaning they raised capital at US$1 billion valuations or larger. Tiger Global Management and Insight Partners were among the most active investors in the first half of the year, per Crunchbase. Tiger has led 87 rounds in 2021, averaging 14 deals per month. https://bit.ly/3wwuI7k

Payments firm Stripe, valued at US$95 billion, takes its first step towards a stock market debut by hiring a law firm, sources say.

Digital payments processor Stripe has taken its first major step toward a stock market debut by hiring a law firm to help with preparations, people familiar with the matter told Reuters on Thursday. The most valuable private company in Silicon Valley, valued at US$95 billion, has sat out this year’s red-hot market for initial public offerings (IPOs), using private tender offers to allow some of its existing investors and employees to cash out their holdings. Remaining private has enabled Stripe to keep financial details such as revenue and profitability under wraps. Yet this has also deprived it of using its shares as a publicly traded currency to help finance acquisitions and to incentivize employees. https://bit.ly/2SXhOBk

Nextdoor to go public through merger with SPAC Khosla Ventures Acquisition Co. II.

Nextdoor Inc. is set to go public as the neighborhood network company announced Tuesday a merger agreement with special purpose acquisition company Khosla Ventures Acquisition Co. II in a deal that values the combined company at about US$4.3 billion. After the merger closes, which is expected to occur in the fourth quarter of 2021, Nextdoor will be listed under the ticker symbol “KIND.” The deal is expected to result in gross proceeds of about US$686 million, including US$416 million in cash. Khosla Ventures’ stock rose 2.1% in premarket trading. “Nextdoor has been at the forefront of cultivating ‘hyperlocal’ communities and neighborhoods since its inception, allowing neighbors to create meaningful connections – both online and offline,” said Nextdoor Chief Executive Sarah Friar. https://on.mktw.net/3jTcVUX

Planet Labs to go public, valued at US$2.8 billion, through merger with SPAC dMY Technology Group.

Planet Labs Inc. is set to go public through a merger agreement with special purpose acquisition company (SPAC) dMY Technology Group Inc. IV in a deal that values Planet at about US$2.8 billion. Planet is a provider of daily data an insights about the earth through a daily scan of the earths’ entire landmass, and has generated more than US$100 million in revenue in the fiscal year ended Jan. 31. The deal is expected to result in proceeds of about US$545 million, including US$345 million in cash held in dMY IV’s trust account and US$200 million through a private investment in public equity (PIPE) by funds managed by BlackRock Inc. https://on.mktw.net/36jBXok

European fintech Wise valued at US$11 billion after London direct listing.

Wise—the money-transfer company formerly known as Transferwise—was valued at more than US$11 billion after the company made its debut on the London Stock Exchange on Wednesday, becoming the most valuable tech firm to join the city’s capital markets. The company was last valued at US$5 billion during a secondary share sale last year. Wise followed the path of the likes of Coinbase and Spotify and opted for a direct-listing, rather than an IPO. The decision appears to have worked well for Wise and the company’s Estonian founders Taavet Hinrikus and Kristo Kaarmann with shares rising in early trading. It was also a good day for the company’s private investors Valar Ventures, IA Ventures and Andreessen Horowitz. U.K.market regulators will also breathe a sigh of relief. There were growing fears homegrown tech firms would look elsewhere to go public after the underwhelming IPO of Deliveroo earlier this year. https://bit.ly/3e4RCw8

USDC backer Circle to go public in SPAC deal. 

Circle is going public in a deal that values the crypto financial services firm at US$4.5 billion, the firm said Thursday. Circle will go public by way of Concord Acquisition Corp, a publicly-traded special purpose acquisition corporation (SPAC). Last month, Circle raised US$440 million in one of the biggest funding rounds in crypto history. At the time, a Circle spokesman declined to comment on the company’s valuation. Fellow stablecoin issuer Paxos was valued at US$2.4 billion after raising a US$300 million Series D in April. https://bit.ly/3hPLQiS

Stamps.com to be bought out at a 67% premium by Thoma Bravo. 

Stamps.com Inc. announced Friday an agreement to be acquired by software investment firm Thoma Bravo in a cash deal that values the web-based mailing and shipping services company at US$6.6 billion. Stamps’ stock soared 35.6% in premarket trading, prior to a trading halt for news. Under terms of the deal, which is expected to close in the third quarter of 2021, Stamps shareholders will receive US$330 in cash for each Stamps share they own, representing a 67% premium to Thursday’s closing price of US$197.72, and 6.7% above the Aug. 7, 2020 record close of $309.36. https://on.mktw.net/3yG0BeZ

Apple mulling US$1 billion acquisition of Reese Witherspoon’s media company.

Popular actress Reese Witherspoon has been working with Apple TV+ for some time, but this partnership may become even stronger in the future. According to a new Wall Street Journal report, Witherspoon wants to sell her media company Hello Sunshine, and Apple is one of the potential buyers. Citing people familiar with the matter, WSJ mentions that Hello Sunshine has been exploring a sale in recent months and that the company is valued at around US$1 billion. More than that, Witherspoon’s joint venture is in talks with none other than Apple, which is reportedly interested in acquiring Hello Sunshine. https://bit.ly/36ng5sg

Down US$831 billion, China tech firm selloff may be far from over.

China’s technology giants have seen a combined US$823 billion wiped from their market value since a February peak, with Beijing’s expanding crackdown on the sector fueling investor concern that the selloff is far from over. Authorities on Tuesday issued a sweeping warning to the nation’s biggest companies, vowing to tighten oversight of data security and overseas listings just days after Didi Global Inc.’s contentious decision to go public in the U.S. That has put further selling pressure on China’s biggest technology names including Tencent Holdings Ltd., Alibaba Group Holding Ltd., JD.Com Inc., Baidu Inc. and Meituan. https://bloom.bg/3wvcgMa

China considers closing loophole used by tech giants for U.S. IPOs.

Regulators in Beijing are planning rule changes that would allow them to block a Chinese company from listing overseas even if the unit selling shares is incorporated outside China, closing a loophole long-used by the country’s technology giants, according to people familiar with the matter. The China Securities Regulatory Commission is leading efforts to revise rules on overseas listings that have been in effect since 1994 and make no reference to companies registered in places like the Cayman Islands, said the people, asking not to be identified discussing a private matter. Once amended, the rules would require firms structured using the so-called Variable Interest Entity model to seek approval before going public in Hong Kong or the U.S., the people said. The proposed change is the first indication of how Beijing plans to implement a crackdown on overseas listings flagged by the country’s State Council on Tuesday. Closer oversight would plug a gap that’s been used for two decades by technology giants from Alibaba Group Holding Ltd. to Tencent Holdings Ltd. to attract foreign capital and list offshore, potentially thwarting the ambitions of firms like ByteDance Ltd. contemplating going public outside the mainland. https://bloom.bg/3yBpLeO

Didi says app takedown could hurt revenue in China.

Didi Chuxing, the Chinese ride-hailing giant that went public in New York last week, said the Chinese government’s decision over the weekend to remove the company’s app from app stores in the country could hurt its revenue. “The company expects that the app takedown may have an adverse impact on its revenue in China,” Didi said in a statement Monday. While Didi has expanded into Latin America and other parts of the world, China accounted for about 98% of its revenue in the first quarter, according to its IPO filings. Didi said its existing users who already have downloaded the app can continue to use its services. On Sunday, China’s internet regulator ordered app stores to remove Didi’s app, saying that the company had violated Chinese laws regarding the collection and usage of personal information. The move came just days after Didi’s U.S. IPO, which raised US$4.4 billion. https://bit.ly/3r3gKZp

Didi’s trouble with regulators could chill China tech plans for U.S. IPOs.

Didi Chuxing’s trouble with China’s regulators raises questions about the ride-hailing giant’s future just days after it raised US$4.4 billion in a U.S. initial public offering. It also could discourage other major Chinese tech companies from going public in the U.S. On Sunday, the Cybersecurity Administration of China ordered Didi’s app to be removed from app stores, two days after it announced an investigation on the grounds of national security laws. Then on Monday, the regulator broadened the campaign when it announced probes of two other Chinese internet companies—logistics firm Full Truck Alliance and recruitment app Boss Zhipin—that also went public in New York recently. Raising the specter that this could presage a wider crackdown on Chinese firms that go public in the U.S., the Global Times, a high profile newspaper under the People’s Daily, the official Communist Party mouthpiece, issued a strongly worded editorial Monday. It said that to preserve national security, U.S.-listed companies like Didi, which collects a lot of data in China and whose largest shareholders are foreigners, need to be brought under Beijing’s strict supervision. Didi’s trouble comes as Beijing has been tightening its control over China’s biggest internet companies. Last November, China’s financial regulator forced Ant Group to scrap its US$37 billion IPO and the company is now undergoing a major restructuring of its business. The government also has launched antitrust investigations into internet giants and issued new rules on user data collection. Investors say the national security questions for Chinese companies’ listings in New York add an extra layer of complexity to the crackdown. “This is going to be very negative for future China tech IPOs,” said Daye Deng, an independent investor who previously was an analyst for a large Canadian pension fund. “We could see an overhang for quite some time and this could spark a debate on China as an investable class altogether.” https://bit.ly/3qZzA3w

Didi’s executives gave themselves US$3 billion in stock before IPO.

The senior leadership of Chinese ride-hailing giant Didi Global granted themselves stock options worth US$3 billion in the second quarter, before last week’s initial public offering, securities filings show. That move is likely to inflame investor anger over the offering as Wall Street comes to grips with the Chinese government’s weekend directive that Didi remove its app from app stores, curtailing future growth. Didi shares fell 21% on Tuesday morning as investors reacted to the app takedown order from  the Cyberspace Administration of China. The internet regulator said Didi’s app had violated laws regarding the collection and usage of personal information. While Didi had warned in its IPO paperwork of its exposure to Chinese regulations relating to data security, The Wall Street Journal reported on Monday that the government had suggested Didi delay the IPO while it reviewed its data security, but Didi had ignored the suggestion. The company went public last week. https://bit.ly/36snPct

LinkDoc becomes first Chinese firm to shelve U.S. IPO after Beijing’s crackdown.

Chinese medical data group LinkDoc Technology Ltd has shelved plans for an IPO in the United States due to Beijing’s clampdown on overseas listings by domestic firms, according to three sources with direct knowledge of the matter. It is the first Chinese firm known to have pulled back from IPO plans since China’s cybersecurity regulator toughened its approach to oversight last week with an investigation into ride-hailing giant Didi Global Inc just two days after its New York debut. That was soon followed with an order for Didi’s app be removed from app stores. https://reut.rs/3hwx7ud

Amazon is now selling its own COVID-19 test kits for US$39.99 in the U.S.

Amazon announced this morning it would begin to sell its own brand of COVID-19 at-home tests to Amazon shoppers in the U.S. The test retails for US$39.99 on the Amazon.com website and is available to any U.S. customer without a prescription. The COVID-19 PCR collection kit is shipped to the customer’s home via Amazon Prime, offering everything needed to perform a nasal swab. Customers will then return the collection tube with the swab inside via the included return box. Amazon says it will be able to provide results within 24 hours of receiving the sample at its lab. https://tcrn.ch/3xuzjrG

Apple Watch and other wearables can detect long-term effects of COVID-19, early research suggests.

Since the onset of the COVID-19 pandemic, a handful of studies have set out to determine whether wearables such as the Apple Watch can detect early signs and symptoms of COVID-19. A new paper published today in the journal JAMA Network Open highlights that wearables like the Apple Watch and Fitbits could also provide data on the long-term effects of COVID-19. As reported first by the New York Times, the new data comes from the Digital Engagement and Tracking for Early Control and Treatment (DETECT) trial run by scientists at the Scripps Research Translational Institute in California. This study ran from March 25, 2020 through January 24, 2021 and included more than 37,000 people using Fitbits, Apple Watches, and other wearables. The study was powered by the MyDataHelps research app. https://bit.ly/3ARdCV4

Pokémon GO catches US$5 billion in lifetime revenue in five years.

Smash hit Geolocation AR title Pokémon GO from Niantic has surpassed US$5 billion from player spending as the title celebrates its five-year anniversary since its launch back in 2016, Sensor Tower Store Intelligence data shows. The latest milestone means the title has generated US$1 billion on average each year. It remains the clear leader in the Geolocation AR category globally, picking up US$641.6 million in the first half of 2021. That puts it above titles such as Dragon Quest Walk from Square Enix, which has accumulated US$261 million so far this year, and Jurassic World Alive from Ludia. https://bit.ly/3hpHv6W

Epic Games antitrust case against Apple gets go-ahead in Australia as we await US ruling.

We’re still awaiting a US ruling in the Epic Games antitrust case against Apple, but the games company has now received the go-ahead to take the same case to court in Australia. Apple had successfully blocked legal proceedings in the country, arguing that the matter was already being decided in the US, but Epic has now managed to get that ruling overturned – at least, for now. https://bit.ly/3wtak6Z

Hall of Fame Resort stock surges after partnership with Esports Entertainment.

Shares of Hall of Fame Resort & Entertainment Co. shot up 7.1% in premarket trading Friday, after the owner of the Pro Football Hall of Fame announced a partnership with esports and online gambling company Esports Entertainment Group Inc. . Esports shares slipped 1.2% ahead of the open. As part of the partnership, Esports will become the official esports provider at the Hall of Fame Village, and will operate a Helix eSports entertainment center that is slated to open in mid-2022. “Having an EEG-powered esports complex as part of our development on campus adds another compelling opportunity for gaming enthusiasts and guests to engage in virtual environments as well as offering us the ability to draw in fans from all over the world – both in person and virtually – providing us with strategic growth opportunities within our company’s gaming vertical,” said Hall of Fame Resort Chief Executive Michael Crawford. https://on.mktw.net/2SXzBZ8

Apple-backed ride-hailing service Didi Chuxing removed from App Store over privacy concerns. 

Back in 2016, Apple announced a US$1 billion investment in the Chinese Uber competitor Didi Global, with Tim Cook saying the investment presented a variety of strategic opportunities for Apple. The investment also earned Apple a seat on Didi’s board. Now, just days after going public with a US IPO, Didi Chuxing is under fire for illegally collecting user data, and the China Cyberspace Administration has now ordered the app to be removed from the App Store. https://bit.ly/3jU9M7x

Apple wins privacy battle in China.

Baidu, Tencent, ByteDance and other tech companies created a system to get round Apple’s privacy policies but the effort petered out. A co-ordinated attempt by Chinese tech companies to circumvent Apple’s privacy policies has been forestalled, a significant victory for the iPhone-maker in what was seen as a threat to its global privacy push. https://on.ft.com/3jVaX6A

After Apple tightens tracking rules, advertisers shift spending toward Android devices.

Advertisers have begun shifting their spending patterns in the months since Apple Inc. began requiring apps to gain iPhone and iPad users’ permission to track them. After the tracking change took effect in April, many users of Apple’s iOS operating system have received a high volume of prompts from apps asking permission to track them—requests that most have declined. Less than 33% of iOS users opt in to tracking, according to ad-measurement firm Branch Metrics Inc. https://on.wsj.com/3AE0ySF

36 states, D.C. sue Google for alleged antitrust violations in its Android app store. 

In addition to Wednesday’s suit, Google also faces a suit that the Justice Department and 14 states filed in October, focused on Google’s efforts to dominate the mobile search market; one from 38 states and territories filed in December, also focused on search; and a third suit by 15 states and territories related to Google’s power over the advertising technology. In a blog post, Google dismissed the suit as “meritless,” saying the changes the plaintiffs demand for its Google Play store risk “raising costs for small developers, impeding their ability to innovate and compete, and making apps across the Android ecosystem less secure for consumers.” https://politi.co/3hLV5AO

Biden to sign order to crack down on Big Tech, boost competition ‘across the board’.

President Joe Biden on Friday will sign a new executive order aimed at cracking down on anticompetitive practices in Big Tech, labor and numerous other sectors. The sweeping order, which includes 72 actions and recommendations that involve more than a dozen federal agencies, is intended to re-shape the thinking around corporate consolidation and antitrust laws, according to a White House fact sheet. https://cnb.cx/3hrtLbW

Gang behind huge cyber-attack demands US$70 million in Bitcoin.

The gang behind a “colossal” ransomware attack has demanded US$70 million (£50.5 million) paid in Bitcoin in return for a “universal decryptor” that it says will unlock the files of all victims. The REvil group claims its malware, which initially targeted US IT firm Kaseya, has hit one million “systems”. https://bbc.in/2V7P3Tf

Pentagon cancels disputed JEDI cloud contract with Microsoft.

The Pentagon said Tuesday it canceled a disputed cloud-computing contract with Microsoft that could eventually have been worth $10 billion. It will instead pursue a deal with both Microsoft and Amazon and possibly other cloud service providers. https://yhoo.it/3hJCaX6

Southeast Asia is world’s fastest-growing mobile wallet market.

Southeast Asia is the world’s fastest-growing region for mobile wallets, followed by Latin America and Africa & Middle East, research from London-based fintech company Boku Inc. shows. The number of mobile wallets in use will grow 311% from 2020 to almost 440 million by 2025 across Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam, reflecting an e-commerce boom, according to a global study on the industry, which was published on Thursday in partnership with Juniper Research Ltd. The usage in Latin America is set to expand 166% during the same period, while that in Africa and Middle East will grow 147%. Mobile wallets overtook credit cards to become the most widely used payment type globally in 2019, according to the report, and adoption accelerated during the pandemic. There were more than 2.8 billion mobile wallets in use at the end of 2020, and that’s projected to increase 74% to 4.8 billion by the end of 2025. In 2020, there were 55 stored value mobile wallets that processed more than $1 billion in annual transactions. Pakistan’s SadaPay is projected to be the fastest-growing mobile wallet in the world in the five years to 2025, followed by Mercado Pago and PicPay in Brazil. https://bloom.bg/3hylaEg

Bitcoin mining is now easier and more profitable as algorithm adjusts after China crackdown. 

It just became a whole lot easier and much more profitable to mine for bitcoin. The world has known for months that more than half the world’s bitcoin miners would be going dark as China cracked down on mining. Now that it’s happened, the bitcoin algorithm has adjusted accordingly to make sure miner productivity doesn’t continue to fall off a cliff. That adjustment – which took effect early Saturday morning – also means that way more cash is going to the bitcoin miners who remain online. https://cnb.cx/3jXVd2S

Fake Tesla, Apple stocks have started trading on blockchains. 

For years, the powers that be on Wall Street have toyed with questions about whether it would be feasible to move the stock market onto a blockchain, the underlying technology behind cryptocurrencies. The innovators in the fast-moving world of decentralized finance — or DeFi — aren’t waiting around to see how those discussions unfold. Instead, they’ve built synthetic versions of equities that track some of the world’s biggest companies. In essence, the anti-establishment ethos of the crypto world is being applied to a rough facsimile of the stock market. https://bloom.bg/3yveIng

Visa is partnering with over 50 crypto companies to allow clients to spend and convert digital currencies.

Visa on Wednesday announced that it is partnering with over 50 cryptocurrency companies including FTX and Coinbase to allow clients to spend and convert digital currencies through its card program. The partnership will make it easy for clients to convert and spend digital currencies at 70 million merchants worldwide, even those that do not accept digital assets. “The merchants don’t have to change anything,” Cuy Sheffield, Visa’s head of cryptocurrency, told Insider. “It will be the same as any other Visa transaction to them. But on the backend, the crypto assets are instantly converted into fiat.” https://bit.ly/2VfZcgF

Square is building a hardware crypto wallet and service with the goal of making bitcoin ‘more mainstream’.

Square executives confirmed on Thursday the company plans to develop new tools for bitcoin. “We have decided to build a hardware wallet and service to make bitcoin custody more mainstream. We’ll continue to ask and answer questions in the open,” Square hardware lead Jesse Dorogusker said on Twitter. “With that, @jessedorogusker, I, and team will listen and continue the conversation. And we’ll set up a dedicated Twitter and github account if we decide to build. We’ll update this thread with that information when we’re ready. Thanks!” Square and Twitter CEO Jack Dorsey said in response. https://bit.ly/3htnHzD

China busts chip smuggling operation from Hong Kong amid semiconductor supply crunch.

Chinese customs said they have busted two recent cases of Hong Kong drivers trying to smuggle computer chips into mainland China via the Hong Kong-Zhuhai-Macau Bridge, as demand for semiconductors soars amid a global shortage. Customs officers found and seized a total of 256 Intel central processing units (CPUs) taped to a driver’s chest and calves in an inspection on June 16, according to an official report. Officers intercepted another batch of 52 smuggled Intel CPUs in another inspection 10 days later, when a driver tried to sneak in the chips by stuffing the package in between the two front seats of the vehicle. The chip-smuggling cases come amid a global semiconductor shortage that has caused severe disruption to auto production around the globe. Despite vows from global foundries like Taiwan Semiconductor Manufacturing Co to ramp up capacity as soon as possible, the shortage continues unabated, with many customers in China scrambling to secure supplies from the fabs, according to industry insiders. While it is not the first time Chinese customs have intercepted smuggled chips from Hong Kong, two cases in one month could indicate a rise in such activity due to the dire supply and demand situation. https://bit.ly/3hxDZYm

Dodge will make an electric muscle car in 2024.

Dodge announced it would make an all-electric muscle car in 2024. The news came as part of an event Thursday covering electric vehicle strategy by the automaker’s parent company, Stellantis. The announcement about the electric muscle car was a little muddled as it came a few minutes after Dodge CEO Tim Kuniskis proclaimed forcefully that Dodge would not “sell electric cars — it will sell eMuscle,” which is apparently Dodge branding for its future EVs (we assume, it was a little unclear). https://bit.ly/3htrSeO

European e-truck charger network planned.

Volvo Group, Daimler Trucks and Traton, Europe’s three largest truckmakers, plan to roll out a dedicated super-fast charging network for haulage vehicles and coaches to help accelerate their shift to the electric era. The groups yesterday announced a joint venture that will invest €500m in 1,700 chargers and aim to attract public funding for the project. The haulage industry estimates it needs 50,000 chargers across Europe by 2030. https://on.ft.com/3wklpHp

Esports are the most popular form of entertainment, and esports betting is ramping.

Sophic Capital client Real Luck Group (LUCK-TSXV, LUKEF-OTC) is poised to become a dominant esports betting service. CEO Thomas Rosander is hosting an investor update on Monday, July 19 at noon EST / 9am PST. To learn more, please register HERE . Investors are encouraged to submit their questions via email at All@SophicCapital.com.