Financials
The Genius Act has changed America’s relationship with crypto, making it the most attractive country in the world for stablecoins. Abacus’ latest report notes that while the pace of adoption is still unclear, long-term disruption of financial incumbents appears inevitable. CRCL’s model is attractive if USDC can scale, though Abacus estimates ~10x growth is needed to deliver a reasonable IRR - a challenging hurdle. Blockchains are expected to replace legacy infrastructure, with SWIFT the first casualty. Visa and Mastercard face limited near-term risk, but crypto is the primary long-term threat to their duopoly. Stablecoins have the potential to reach >$2trn m/cap in the next few years vs. $260bn today. Abacus sees CRCL as a compelling risk/reward play, with upside potential of 195% outweighing downside risk of 50%.
Edition: 218
- 22 August, 2025
Crypto: The ultimate Trump trade
In April 2017, Jawad Mian expressed a bullish opinion on Tesla, with the company at the epicentre of Trump’s economic nationalism. This time around, he’s betting on crypto. Trump has made it clear that his administration will support digital currencies, in contrast to the Biden administration’s scepticism. Although crypto assets have performed poorly since the March peak, the legislature appears to be warming up to crypto. New legislation has been passed to provide regulatory clarity for digital asset innovation and the SEC even approved exchange-traded funds for ether. Other positive developments are emerging, including Mastercard’s recent decision to allow users of Binance to make purchases on its network. If Bitcoin is ever going to make a run for $100,000, now is the time.
Edition: 189
- 28 June, 2024
Technology
As the world relentlessly shifts towards cashless payments, giants in payment processing such as Visa are central to this revolution. Despite initial lagging behind its rival, Mastercard, in developing high-profitability partnerships aimed at digital and e-commerce solutions, Visa is now mirroring its competitor's strategy. It's concentrating on expansion into digital solutions and pouring significant investments into partnerships. These efforts are now positioned to start reaping benefits for the company.
Edition: 162
- 09 June, 2023
Plenty of value in Payment companies
Technology
Galliano's Financials Research
Victor Galliano highlights PagSeguro for its attractive valuations vs. its Brazilian and global peer group. Getnet is also considered too cheap to ignore despite its challenging relationship with Santander. While Nexi is the only European payments company added to Victor’s buy list - negative sentiment as a result of poor execution on past acquisitions is more than well discounted in the share price. In the megacap names, Mastercard remains a key pick.
Edition: 132
- 01 April, 2022
FinTech & Financials: 2022 investment themes
Financials
Galliano's Financials Research
1. A shift into value in EM banks; cautious on digital banks - top picks are Sberbank, Banco do Brasil and HDFC Bank. Nubank likely to be one of the EM FinTech big negative surprises of 2022.
2. Southern Europe banks, position for the prospect of higher interest rates - highlights BBVA and Banco BPM.
3. Exchanges, competitive pressures are real, but are they priced in - B3 and Singapore Exchange standout.
4. Growth and value in digital payments - highlights Mastercard and, for its deep value, PagSeguro.
5. Digital wealth managers, picking a potential winner - BTG Pactual.
Edition: 126
- 07 January, 2022
Ceridian (CDAY)
Technology
Underappreciated opportunity - CDAY’s Dayforce Wallet is the company’s first foray into a very different segment of the fintech ecosystem: digital wallets and earned wage access solutions. In this industry primer, Veritas assess the competitive landscape and compare CDAY's offering to products launched by Apple, Alphabet, PayPal, Square, Mastercard, Visa, Tencent and Alibaba. Veritas think the long-term gains of developing a fintech ecosystem are incredibly attractive and CDAY’s unique distribution advantage will help carve itself a piece of the market. Estimates that the module can generate ~US$220m of annual net earnings and be worth US$19 per share.
Edition: 114
- 09 July, 2021