Mogo Completes Strategic Investment in Crypto Platform, Coinsquare
Mogo Inc. (NASDAQ:MOGO) (TSX:MOGO) (“Mogo” or the “Company”), a digital payments and financial technology company, today announced that it has closed its previously announced strategic investment (the “Investment”) in Coinsquare Ltd. (“Coinsquare”), Canada’s leading digital asset trading platform, pursuant to which Mogo has acquired a 19.99% ownership interest in Coinsquare for total aggregate consideration consisting of a cash payment of $27.4 million and the issuance of 2,807,577 common shares of Mogo (the “Mogo Shares”) to Coinsquare and certain selling shareholders of Coinsquare (the “Vendors”). The Investment also includes rights for Mogo to increase its ownership up to 43% at a fixed price, through purchases of shares from current shareholders and the exercise of warrants under certain conditions. Mogo’s strategic investment builds on a multi-year relationship between the two companies. Coinsquare acts as the trading platform for MogoCrypto, a service Mogo launched in 2018 to allow its members an easy and convenient way to buy and sell bitcoin.
Since its founding in 2014, Coinsquare has grown to become the leading digital asset trading platform in Canada. Coinsquare has experienced record Q1 results as the popularity of digital assets continues to reach new highs. As of Q1 2021, assets on platform were up 700% year over year to over $630 million and revenue increased approximately 500% year over year, from $3.15 million to an estimated $19.0 million in Q1 2021*.
“With the global crypto market cap now at over $2 trillion, doubling in just a few months, it’s clear that crypto is not only the fastest-growing asset class but an increasingly important one that investors want access to. Coinsquare has built a premier crypto platform and a leading market position in Canada,” said David Feller, CEO of Mogo. “By deepening our relationship with Coinsquare and leveraging their crypto capabilities alongside Mogo’s broader digital wallet capabilities including our recently announced transaction with Moka, we believe Mogo is extremely well positioned to provide Canadians with a leading next gen wealth offering.”
Mr. Feller continued: “We believe the leading wealth platforms in Canada five to ten years from now will be modern, digital-first platforms that offer a significantly enhanced value proposition, both in terms of product offering, but most importantly in terms of a modern user experience that helps consumers build wealth and achieve their financial goals more efficiently and effectively than ever. This strategic investment in Coinsquare is just one more step toward our goal of building Canada’s leading next gen wealth offering.”
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