Cryptocurrency is still alive and thriving, particularly for GSTechnologies Ltd (LSE: GST), a small-cap fintech company based in London that has historically focused on the intricate areas of blockchain and stablecoin industries.
This year, GSTechnologies has been working hard to get its stablecoin project approved by the relevant UK regulators. In June, the company reported significant progress on its application to enter the UK Financial Conduct Authority (FCA)’s Regulatory Sandbox. For those who may not know, a stablecoin is a type of digital currency that is tightly linked to another asset, usually the US dollar, though stablecoins tied to the sterling, the Mexican peso, and the euro also exist.
The aspiration of GSTechnologies is to become the first issuer and service provider of stablecoins on the London Stock Exchange. As they continue this journey, the company has recently broadened its reach into the Canadian finance market by legally binding an agreement to purchase PAYPT Finance, a Canadian company that holds a Canadian Money Services Business (MSB) licence. GSTechnologies has plans to rebrand PAYPT as Angra Global, a development that was well-received by investors, causing GST’s shares to surge by over 46% to 0.77p on the standard segment this week.
On a similar note, it’s been a solid week for small caps in general, with the AIM All-Share Index increasing by 1.9% to 765.79p since the start of the week. Positive inflation data on Wednesday and strong retail sales figures on Friday contributed to this growth.
There’s no denying that the year-on-year inflation rate is alarmingly high at 7.9%, but it’s slightly better than the 8.2% predicted by the market. Several small-cap mining companies also had an impressive week.
Empire Metals Ltd (AIM: EEE) saw an additional 40% surge, bringing the total gains to 133% for the month. The company had a successful July operationally, with promising updates on its titanium mining projects in Western Australia. CleanTech Lithium’s upgraded resource estimate at its Chilean Laguna Verde project set the tone for a strong trading week, adding 40% by Friday’s closing bell.
Powerhouse Energy Group PLC (AIM: PHE) surged by 45% after announcing on Tuesday that its European patent for its non-recyclable waste conversion technology is making substantial progress.
Outside the heavy industry sector, Gresham House, an alternative investment fund manager, grabbed attention with an attractive takeover offer from private equity firm Searchlight Capital. Gresham accepted Searchlight’s £470mln bid at 1,105p per share, which marked a 63% premium on Friday’s closing price of 680p.
However, not all companies had a positive week. Native advertising firm Dianomi posted a bleak trading update, warning of a significant drop in traffic volumes across its financial services websites client base. Traffic across Dianomi’s key publishers was down by up to 30% in the six months to June 30, compared to the same period in 2022. Consequently, shares dropped by 40%.
Lookers PLC (LSE: LOOK) also suffered a 14% drop after the company’s shareholder, Cinch, announced its intention to obstruct Lookers’ proposed sale. After pulling back a letter of intent to support Global Auto Holdings Limited’s takeover of Lookers, Cinch, a 19.2% stakeholder, now plans to vote against the acquisition.
And finally, the Cameroon-focused oil company, Bowleven, had a turbulent week with shares fluctuating significantly on Friday. The company issued a statement on Friday morning indicating it was unaware of any reason for its share jump to 1.75p from 1.05p the day before. This sent the share price down by a third at the opening, but some of the losses were recovered by mid-morning.
