RAIZ: NAB buys stake in Zodia and gets ahead of cryptocurrency regulation curve

raiz.com.au

Raiz Invest

4 Min Read21 Jun, 2024

The National Australia Bank’s Zodia stake shows cryptocurrency could be back on the agenda. Credit: Brendon Thorne/Getty Images

Cryptocurrency had its heyday when you could barely open a financial page without someone spruiking the latest in the technology, but it seems there is still some life in it.

National Australia Bank ($NAB) just bought a stake in a cryptocurrency business called Zodia Custody, which is a competitor to Coinbase. Zodia allows clients to hold crypto coins like bitcoin and ethereum, as well as tokenised real-world assets including commodities or property.

NAB did not reveal the size of the investment according to the AFR which broke the news, but it is believed that the investment could put NAB ahead of the regulatory curve. Australian cryptocurrency laws could soon require crypto assets to be separated from the internet, in what is called cold storage. Zodia would allow for that which is where NAB’s interest lies.

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The bank also hit a nine-year high over the last week which could explain why the number of stocks traded were up 272 per cent over the last seven days on Raiz. Over 1500 shares were traded, which is a 6000 per cent increase over the last month.

Telstra Group ($TLS) also saw a big week on the platform, with the number of shares traded up 114 per cent over the last week. The company held steady this week despite the telecommunication sector as a whole falling slightly. The Telco has become the sixth organisation globally to join UNESCO’s Business Council as it looks to promote the ethical use of AI technologies.

In a statement, the company said it would work with UNESCO to support policy development in critical areas to “champion and advance the ethical development and application of AI.” The company hit a month-long high on Raiz back at the end of May with over 5000 shares traded. It has managed to stay in the top 10 on Raiz since then, proving it is still a popular stock among investors.

South32 ($S32) had a fall from grace, dropping over 61 per cent in shares traded over the last seven days. The stock has done a bit of bouncing around over the last month, hitting an 11,000 high at the end of May, before bouncing back slightly last week for over 6000 shares traded.

There is nothing particularly newsworthy that would have set off investors, indeed UBS even upgraded its earning projections for the company by 13 per cent. This is due to higher prices for manganese and alumina, two metals that South32 is involved with. Macquarie also has shown optimism in its shares due to the copper exposure. Despite the positive broker notes it was still the laggard in the top 10 this week.

Trading activity overall though was still up minimally, with the top 10 increasing in overall units traded by just over 2 per cent. The ETF market also saw similar movement, up just over 2 per cent over the last seven days. The biggest movement on the top 10 was the Global X Semiconductor ($SEMI) ETF which was up by 65 per cent over the week.

This last week saw NVIDIA overtake Microsoft to become the world’s most valuable company in market capitalisation. Its high-end processors play a central role in AI computing and it’s one of the many companies that SEMI invests in. It’s a market trend that isn’t losing steam anytime soon.

The only other notable movements were by Russell Investments Australian Responsible Investment ETF ($RARI) and iShares Europe (IEU). The number of units traded for the two ETFs went up 13.9 per cent and 13.3 per cent respectively despite no direct news. But as always with ETFs, it is often about the theme at play over the particular ETF itself.

On the flip side, no real laggards with just the iShares Asia ($IAA) seeing an 11 per cent drop in interest but still sitting about 30,000 units traded over the last seven days.

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Raiz Invest Australia Limited – Authorised Representative of AFSL 434776. The Raiz Invest Australia Fund is issued in Australia by Instreet Investment Limited (ACN 128 813 016 AFSL 434776) a subsidiary of Raiz Invest Limited and promoted by Raiz Invest Australia Limited (ACN 604 402 815). PDS and TMD are available on the Raiz Invest website and App. You should read and consider those documents before deciding whether, or not, to acquire and continue to hold interests in the product.