As a bubble asset that cannot be falsified, Bitcoin has skyrocketed and has increased tenfold this year. Various companies in the secondary market have also relied on the golden sign of "blockchain" with various purposes and various means. For a while, the demons were in chaos, w

Bitcoin, as a bubble asset that cannot be falsified, has been skyrocketing. It has increased tenfold this year. Various companies in the secondary market have also used various means to rely on the golden sign of " blockchain " with various purposes. , a group of demons danced wildly for a while, and the huge rise and fall caused many speculators to wander between the rooftop rooftop and the nightclub on the ground floor every day, triggering heated discussions among users in the Tiger Securities community.

Recently, the Bitcoin concept stock Longfin Corp rose from US$5 per share to US$72.38 per share in four trading days, with a market value of US$1.16 billion, reaching a peak of US$142.82 per share. The highest intraday increase in four trading days exceeded 27 times.

Quotation source: Tiger Securities APP

"Who is this listed company in the US stock market that has surged 27 times in 4 days?"

Longfin Corp is an independent financial and technology company that specializes in providing financial institutions and trading platforms in North America, South America and Africa. Provides structured trade finance solutions and physical commodity finance solutions. LongFin's core business plan is to leverage Stampede's technology, strategy, infrastructure and its business model to provide the same business in Asia Pacific, the Middle East and Europe, providing liquidity technology to all major global banks and commodity trading companies solution. LongFinCorp was listed on Nasdaq on December 13, issuing 10 million Class A common shares, with an IPO price of US$5 per share and a financing amount of US$50 million.

Longfin’s surge stems from the company’s announcement on December 15 of the acquisition of a Singapore blockchain company. Ziddu was founded in 2007 and is a blockchain-authorized microfinance solution provider. The company uses Ziddu coins or other Microfinance loans are provided in the form of cryptocurrencies against collateralized warehouse receipts.

Ziddu Coin offers contracts that enable SMEs, processors, manufacturers, importers and exporters to use cryptocurrencies on all continents. Ziddu coin is loosely pegged to Ethereum and Bitcoin. The importer/exporter converts the provided Ziddu coins into Ethereum or Bitcoin and uses the proceeds for working capital needs. At the end of the contract, the importer/exporter will realize the proceeds and repay the funds via cryptocurrency. Depending on the risk profile of the counterparty, interest will range from 12% to 48%.

"The emergence of blockchain technology has captured the imagination of the global financial services industry. Blockchain is becoming a technological revolution aimed at disrupting financial services infrastructure. Cryptocurrencies such as Bitcoin and Ethereum will serve as global financing currencies , used to lend credit to hard currencies in many emerging markets," said Longfin Corp. Chairman Venkat Meenavalli.

Company Business Introduction

LongFin is a financial technology company that mainly provides structured commodity trade financing solutions for small and medium-sized enterprises and banks; in addition, it also uses its own artificial intelligence and machine learning technology to develop and research electronic market makers. The platform provides corresponding solutions for exchanges, securities firms, and banks. The specific business includes the following three items:

1. Structural commodity trade financing:

refers to taking the trade process as the entire financing object. By matching these financing methods, enterprises can reduce their own capital occupation and reduce the pressure on their own funds while bearing moderate risks. The full range of trade finance services is a selective synthesis of the two concepts of commodity finance and trade finance. The specific operation method of LongFin is to match importers and exporters in the form of a third-party platform and make profits through the difference between the buying and selling price. LongFin issues a 180-365 day usance letter of credit to the importer to ensure that the importer can make a profit when it expires. At the same time, LongFin conducts face-to-face transactions with the exporter to save unnecessary expenses. The price difference between the import and export parties is LongFin arbitrage space.

2. Alternative risk transfer financing:

For importers in some low-credit countries, LongFin will contact insurance companies to provide them with comprehensive insurance, increase their credit rating, and then provide them with financing loans to reasonably spread the risks to insurance company. LongFin offers short-term loans up to 270 days.

3. Carry trade:

LongFin invests available funds in currencies with higher returns in emerging markets to earn high profits; at the same time, it provides non-deliverable forward foreign exchange trading services for volatile commodities.

Investment Highlights

1. Unique electronic market maker platform:

LongFin’s electronic market maker is developed using artificial intelligence and other technologies. It can provide ultra-low latency and stronger execution capabilities of trading orders. The platform can complete more than 100,000 orders per second. 2500 transactions and latency below 3-4 milliseconds. The platform can be directly connected to exchanges and banks. It is very secure and easy to expand. McKinsey once rated it second among 12 similar platforms. LongFin plans to connect the platform to 70 foreign exchange exchanges and at least 300 banking institutions around the world.

2. The multi-trillion trade finance market

The global trade market continues to expand, resulting in a growing gap between trade flows and financing mechanisms. According to data from the Bank for International Settlements, global trade financing demand reached US$6.5-8 trillion in 2014. In 2015, there was a US$1.6 trillion gap in global trade finance that financial institutions were unable to fill, of which US$690 billion came from Asia and US$200 billion. Dollars come from Africa. Such huge demand provides a broad market for non-bank financing institutions such as LongFin.

3. The rapid development of non-bank liquidity providers

Since the financial crisis, technology-based non-bank liquidity providers have developed rapidly, especially in the foreign exchange market. In 2015, the share of non-bank liquidity providers in the foreign exchange market was approximately 20%, an increase of 16% from 2014, and this figure will reach 30-35% next year. The huge trading volume of the foreign exchange market also provides good development space for this institution, with daily foreign exchange trading volume reaching up to 5 trillion US dollars. At the same time, in recent years, there have been fewer and fewer scattered trading customers in trade transactions, while the number of multi-merchant trading platforms (MDP) like LongFin has increased. Since 2008, MDP has increased by 32%, while transactions on a piecemeal basis have declined by 50%.

financial data: As of June 30,

had total assets of US$29 million and total liabilities of US$12 million.

As of March 31, 2017, LongFin’s revenue in fiscal year 2016-17 was approximately US$40 million, revenue in fiscal year 15-16 was approximately US$16 million, and revenue in fiscal year 14-15 was approximately US$1.1 million.

According to estimates from SeeThruEquity Research, LongFin’s revenue will reach US$60 million in fiscal year 2019 and US$240 million in 2022.

Equity Allocation:

Currently LongFin Chairman and CEO Venkat S Meenavalli holds 54.87% of the shares, Stampede Capital holds 37.72%, and the remaining management holds 7.41%. After the public issuance of

shares, Meenavalli will reduce its holdings to 48.25%, Stampede Capital holds 33.17%, the remaining management holds 6.51%, and new investors hold 12.06%.

Tiger Securities Tip: Securities investment is a risky investment behavior. Investors need to make investment decisions based on comprehensive analysis of information from multiple parties. This article only provides investment knowledge learning materials for investors and does not constitute any investment advice.