Own Kogan (ASX:KGN) shares? This $5m under-the-radar deal could signal a crypto play

Here’s how Kogan is getting involved in crypto trading.

| More on:
A man handles a transaction on his smartphone using Facebook's new crytocurrency diem

Image source: Getty Images

Cryptocurrency-loving owners of Kogan.com Ltd (ASX: KGN) shares can rejoice as the company looks to dip its toes into the world of crypto.

Kogan has made a round-about deal with Canadian cryptocurrency exchange Bitbuy that will see it marketing the platform’s Australian launch.

At the time of writing, the Kogan share price is trading 0.74% higher at $8.15.

Let’s take a closer look at the online retailer and service provider’s foray into the cryptocurrency space.

Kogan shares might soon benefit from crypto trading

On Tuesday, Kogan announced it had reached an arrangement that will see the company gain a boost of around $5 million and a partnership with a crypto exchange.

All that comes at the price of a single domain name.

The company is selling one of its domain names – bitbuy.com – to Bitbuy’s parent company, First Ledger Corp.

The domain will cost First Ledger Corp $US1.5 million (around $2.09 million) in cash.

Additionally, Kogan will receive a warrant entitling it to around $3.04 million (converted from Canadian dollars).

The warrant will be cashed in for either First Ledger equity or cash within a year of transferring the domain name.

Kogan executive director, David Shafer commented on the sale, saying:

The domain sale not only delivers returns for Kogan shareholders but also provides an opportunity to benefit from Bitbuy’s future success in the crypto business abroad and potentially in the Australian market.

According to the company, Bitbuy is one of the most secure and trusted crypto trading platforms in Canada.

It recently became the first marketplace and dealer to be granted approval by the nation’s local security regulators.

Kogan didn’t mention when the crypto trading platform will be looking to launch in Australia.

Right now, Kogan shares are trading for 57% less than they were at the start of 2021. Its share price has also tumbled 10% over the last 30 days.

Should you invest $1,000 in Kogan.com right now?

Before you consider Kogan.com, you'll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Kogan.com wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of January 13th 2022

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns and has recommended Kogan.com ltd. The Motley Fool Australia owns and has recommended Kogan.com ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Cryptocurrencies

Cryptocurrencies

Crypto venture firm’s lessons after $10 million haircut on LUNA losses

What can investors learn from the collapse of LUNA? Here's one research team's take...

Read more »

Clock with post it as a reminder of Tax Time
Cryptocurrencies

Own crypto or NFTs? Here’s why the ATO could have you in their sights come tax time

More than a million Aussies are estimated to have transacted in digital currencies and NFTs this year.

Read more »

woman examining ethereum price
Cryptocurrencies

Why is the Ethereum price down 48% this year?

Higher interest rates increase the appeal of safer investment assets like bonds and cash deposits.

Read more »

a man sitting at a computer at a desk has a look of anguish and trepidation on his face as he opens his eyes wide and made an aargh type expression with his mouth as his hair stands on end and his tie also stands on end with one part over each shoulder in what is supposed to be a humorous picture of something in a panic.
Cryptocurrencies

Un-stable coin? Terra crypto woes continue with another 31% fall

I'd think very carefully before going bargain hunting among stumbling altcoins.

Read more »

Concept image of Bitcoin and hand using laptop.
Cryptocurrencies

Using Bitcoin to diversify your portfolio? Read this

Cryptos have been rising and falling largely in line with other risk assets.

Read more »

Smiling ASX investor holding a gold bitcoin.
Cryptocurrencies

Good riddance to meme speculators ditching Bitcoin: expert

The exit of 'get rich quick' investors from crypto is a boon for serious long-term holders, says DeVere Group boss…

Read more »

a man weraing a suit sits nervously at his laptop computer biting into his clenched hand with nerves, and perhaps fear.
Cryptocurrencies

Can regulators prevent another US$45 billion crypto stablecoin meltdown?

Terra's LUNA token, meant to help its UST token remain pegged to the US dollar, has lost 99.99% of its…

Read more »

A man looks down with fright as he falls towards the ground.
Cryptocurrencies

Is the Bitcoin price heading all the way back down to US$20,000?

Last week's meltdown of UST and its backing crypto LUNA sent most every crypto tumbling lower.

Read more »