McCall’s “Crypto Bank About to Take Off”

What's the "Microcap Millionaire" stock hinted at in ads for Early Stage Investor?

By Travis Johnson, Stock Gumshoe, February 14, 2020

It’s Friday and I’m mostly working on my Friday File and Annual Review for the Irregulars, but I couldn’t resist a quickie answer for you on this latest Investorplace pitch… Matt McCall is selling his Early Stage Investor service ($1799, nonrefundable) with a spiel about eight life-changing microcaps in his “Microcap Millionaires Portfolio.”

He gives away one of them for free in his “presentation” (that being Inseego (INSG), which we’ve covered many times), but also hints at a “secret” one in recent emails.

And that’s where we come in — what’s that other one he hints at?

Don’t worry, I’ll spare you all the big picture stuff and the “microcaps are extra-risky” comments and the teeth-gnashing about “nonrefundable” payments and how much is reasonable to spend for investment guidance, we’ll just get right to the answer.

Here are the clues he drops:

“This recent IPO is one of the first banks ever to specialize in digital currencies.

“This is a big deal, because traditional banks are keeping their doors shut to cryptocurrency and blockchain businesses…

“Which creates an enormous first-mover advantage for my new investment recommendation.

“You can buy a single share of this crypto bank for $16 right now… Its market cap is just $300 million.
But my research indicates it could soar to $75 per share within the next 24 months. That’s a nearly 5X gain.”

So who is it? This must be Silvergate Capital (SI), which did indeed go public very recently, in November, and which is trading right around $16 (after going public right around book value, at $12 a share).

As I said, all I’ve got here is a quickie answer for you — I don’t know much about Silvergate, other than that it’s a regular commercial bank but also, more importantly, provides financial services to cryptocurrency companies, including exchanges like Coinbase.

I don’t know anything else about them, really, other than that they are trading at about 1.3X book value, which, on the face of it, is reasonable for a small commercial bank.

This one is tiny, with a market cap of about $300 million, and it does not have any meaningful institutional shareholders as far as I can tell — I don’t generally like to buy IPOs in their first few months, partly because there’s so often pressure on these stocks around the time that the insider lockup period expires (that would be May 5), but perhaps you’ll find it interesting. Enjoy!

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