Crypto custodial services have been considered a critical element for institutional monies to flow into crypto markets. Even US SEC has mentioned the same a couple of times while disapproving the Bitcoin ETF. A lot of exchanges including Coinbase and Swiss Exchange SIX have launched their custodial services and the latest addition to this list is Hyperblock which secured a contract to provide Insured Crypto Custodial Services for First Institutional Client.
Hyperblock shares jump 50% possibly triggered by the Crypto Custodial announcement
HyperBlock Inc. (CSE: HYPR) is one of North America’s largest publicly traded diversified crypto asset enterprises. The company is operating one of the largest and most efficient cryptocurrency data centres in North America and it strives to help people and businesses create, safeguard and manage crypto assets. Its offerings include server hosting, server hardware sales as well as Mining-as-a-service and now a proprietary Custodial vault product.
While announcing its Q2 results (Canada follows April- March Financial Year format), the company made this major announcement with respect to its crypto custodial services which triggered the stock prices by 50%. HyperBlock confirmed it has received a written commitment for insurance coverage from an A+ rated insurer, for its newly-launched, proprietary crypto custodial service, HyperVault. HyperBlock also announced it has signed a three-year agreement with a private Caribbean-based investment bank to provide insured custodial services. The contract terms include a minimum of $10M in assets under management to start — with a maximum balance of USD$400M in crypto assets under management.
HyperBlock CEO Sean Walsh was quoted saying
“Although it’s been a challenging road that required focus and significant investment, HyperVault is a potential game-changer for HyperBlock,”
The result also had another significant announcement which said that HyperBlock will be moving 100% of its servers to US datacentres
Regarding this decision CEO Sean Walsh was quoted saying,
“During Q3, HyperBlock began to aggressively reorganize our team and reduce data centre and other operating costs inherited with the CryptoGlobal amalgamation. We took these steps in anticipation of ongoing market challenges, and our goal is to consolidate 100% of our mining operations into our Project Northwest datacentre,”
The company estimates the data centre consolidation at Project Northwest will be complete in Q1 2019. Walsh says that by moving out of its Eastern Canada datacenters, HyperBlock expects to potentially save approximately $250,000 in monthly operating costs, due to an average current power pricing at Project Northwest of 3.3 cents.
As far as numbers are concerned, HyperBlock did deliver impressive Q2 financial results helped by its increased focus on cost reduction and capitalization of post-merger efficiencies. EBITDA in the quarter came in at CAD$3 million awaiting to see the kind of results it will report for the third quarter. The company ended the quarter with revenues of CAD$10.1 million.
The unveiling of a crypto custodial solution should get things rolling for Hyperblock as the stock has been languishing at its all-time lows. This should also allow the company to target institutional investors and change its fortune.
Will Hyperblock be able to capture the institutional market through its HyperVault? Do let us know your views on the same.