I was digging around a few weeks ago and uncovered a company I really should have known about, but for some reason has been under my radar – Ether Capital Corporation (NEO: ETHC).

ETHC is all about – you guessed it – Ether and the Ethereum network. In its business thesis available on the ETHC website, Ethereum Capital Corporation states the following :

Ethereum is a world computer that can fundamentally bring decentralization back to the internet. This is what’s referred to as Web 3, where users own their data, privacy is maintained, rent-seeking middlemen have less power and money is internet-native.

Ethereum has established itself as the premiere Web 3 platform. It has the longest operating record, the biggest community of developers (estimated at over 250,000) and the largest number of decentralized applications (over 1,000). It has a clear roadmap for protocol improvements over the next few years that will improve the security and scalability of the platform while retaining its promise of decentralization.

DTM is in agreement. And DTM loves a forward thinking, legitimate, crytpo focused company managed with competence that isn’t overvalued relative to its balance sheet and revenue potential

So what do we have here? I did my initial scan – Most recent MD&A, most recent financial statements, insider transaction reports , recent news and management bios. And thought VERY interesting.

ETHC is, at this point, a holding company for Ether – The native currency of the Ethereum ecosystem. ETHC also owns some other digital assets but the majority of its balance sheet, which was bolstered by a recent 28.75 million dollar financing, is invested in Ether.

The Market Cap of 112.47 million is effectively tethered (pardon the crypto pun) to the value of ETHC’s Ether currency holdings, which as of this date is worth $116 million. ETHC does own smaller positions in the currency MKR (6.4 million) and an exchange platform named Wyre (2 million). That being said, the market at this point views the stock as a fairly pure Ether play which makes complete sense. Hence, it trades like an Ether ETF.

Ether Capital Corporation has a pretty solid looking management team and board who have the right blend of Crypto technology, capital markets and asset management experience. They have a very clean balance sheet. And they’ve quietly raised meaningful money that they’ve decisively deployed into the Ethereum thesis without diluting shareholders. To which DTM says ‘Bravo’!

In ETHC’s business thesis (available on the company’s website) they state:

Ether Capital is pursuing a long term business model built on three pillars:

• Asset management through our holdings of Ether and tokens or equity of other projects,
• Technology development aimed at decentralized application adoption,
• Ancillary blockchain services that generate income from passive assets.

So this is where it gets interesting. ETHC is also providing services to Purpose Investments in support of the launch and management of their 1 billion dollar+ Bitcoin Fund. What that consulting agreement really means isn’t clear at this point.

I am a little hesitant about appending any value to this type of work if it isn’t a disclosed in a management agreement. The details are pretty nebulous at this point. Also, ETHC’s chairman, Som Sief, is the CEO and founder of Purpose. Which, is excellent in the sense that he has a vested interest in both companies and is clearly competent and connected. BUT the lack of clarity around the ‘consulting’ is a sticky point. When an owner / officer of two companies has money flowing between the two, it behooves them to be fully transparent about every detail of the arrangement. This could be improved.

There probably will be other business / consulting / investment opportunities available to ETHC as well. The opportunity for staking their ether holdings alone could be substantial.

This is a really interesting company. There aren’t many (any?) businesses whose shares are truly backed 1:1 by the currency of one of the world’s leading emergent technological platforms. And who have multiple potential streams of revenue from staking, consulting, and other engagements coming on line.

I’ve opened a small position. There is a lot to like about what is being created. Its not a core holding in the DTM5 – Yet – but its on the bench!

GLTA!