EFTA02671121.pdf

From: Brock Pierce < Sent: Wednesday, November 4, 2015 6:34 PM To: • Jeffrey Epstein Subject: Fwd: GBTC - Renewed Interest by Large Financial Institutions and Media; Reiterating OUTPERFORM and Raising BTC Price Target to $600 Attachments: GBTC Renewed Interest_2015.11.04.pdf; (8A8710EA-E286-47F6- B388-6DFDBASCECCF).dat; {216D1986-9891-46C143379-090CC1DC0989}.dat; (05613A4F-6444-46F7-958D-B6C3F4FOC4261.dat Attached is a recent research report. I brought Gil Luria =nto the business and he credits me. Forwarded message From: Gil Luria < < >> Date: Wed, Nov 4, 2015 at 9=47 AM Subject: GBTC - Renewed Interest by Large Financial Institutions =nd Media; Reiterating OUTPERFORM and Raising BTC Price Target to $600 T=: Gil Luria < < >> Now that I have an official price target=for bitcoin I need to update it once in a while (see report attached).<=u> <=> Bitcoin Investment =rust (GBTC) Renewed Interest by Large Financial Institutions =nd Media; Reiterating OUTPERFORM and Raising BTC Price Target to $600 • We believe bitcoin and its associated blockchain technolo=y have the potential to disrupt the existing financial infrastructure over=the next several years, and believe the value of the bitcoin currency (BTC) will benefit from this trend. Please see our GBTC initiation report here. <=i class="MsoNormal" style="color:#14213d;margin-bottom:7.5pt"> We believe the value of bitcoin has started moving up rec=ntly as broad positive media coverage (page 3) has started to sway sentime=t. • Large financial institutions continue to invest and inves=igate uses of bitcoin and its underlying technologies (e.g. Blockchain) at an increasing pace (p4). We believe that Blockchain is to Bitcoin as Intranet is t= Internet. We believe there may be some applicat=ons that narrowly use a distributed ledger without a valuable native token, bu= those will end up being a small part of the EFTA_R1_01940068 EFTA02671121 solutions the technology crea=es. We believe the reason financial institutions are insisting on Blockcha=n not Bitcoin is for internal and regulatory compliance. We expect that even the narrow solutions leveraging=only a distributed ledger will end up being anchored on the bitcoin blockc=ain sooner or later. • We continue to observe consistent transaction growth, esp=cially from applications such as remittance and multi-signature (pages 5-6=. We are also witnessing an increase in payment fees over time, which should=help supplant bitcoin issuing as the revenue source for the transaction pr=cessors running the bitcoin network. • We detail our valuation framework on pages 7-9 to arrive =t our target of $600/BTC ($60/GBTC) - we employ a supply/demand methodolog= based on utilization of future applications. With bitcoin supply mostly predetermined, we estimate bitcoin applications=#39; large and growing addressable market, anticipate an inflection point =f bitcoin application adoption 5-10 years out and apply a high discount ra=e to account for uncertainty. • Reiterate OUTPERFORM rating and raising our GBTC price ta=get to $60 (equivalent to $600/BTC) from $40 based on less conservative su=ply assumptions. The main change to our model is a higher proportion of dormant or held-for=investment bitcoin. November 4, 2015 Price $52.00 Rating OUTPERFORM 12-Month Price Targetau> $60.00 Gil Luria <mailto Aaron Turner Company Information Shares Outst (M)</=> 1,382.0 2 EFTA_R1_01940069 EFTA02671122 Market Cap (B)=/span> $71.8 52-Wk Range $21.22 - $55.00 Book Value/sh<=span> $N/A Cash/sh=/p> $N/A Enterprise Value (M)<=> $N/A LT Debt/Cap %aspen> N/A FYE Dec 2014A 2015E 2016E REV (M) ACTUAL CURR. PREV. CONS. CURR. PREV. CONS. Q1 Mar 3 EFTA_R1_01940070 EFTA02671123 Q2 Jun Q3 Sep Q4 Dec 4 EFTA_R1_01940071 EFTA02671124 Year* Change 2014A 2015E 2016E EPS ACTUAL 5 EFTA_R1_01940072 EFTA02671125 CURR. PREY. CONS. CURR. PREY. CONS. Q1 Mar Q2 Jun Q3 Sep 6 EFTA_R1_01940073 EFTA02671126 Q4 Dec Year' P/E Ex Ex Ex 7 EFTA_R1_01940074 EFTA02671127 Change </=pan> Consensus estimates are f=om Thomson First Call. * Numbers may not add up due to rounding. <=p> Click here to view the full =eport: Rene=ed Interest by Large Financial Institutions and Media; Reiterating OUTPERFORM=and Raising BTC Price Target to $600 <https://equities.wedbush.com/clientsite/Resea=ch/ActionAlertFilePreview.asp?UUID=172801F2-62D6-4A4A-9E2A- E68E7D48D546&=mp;ViewerlD=10E41D70-8184-45DA-AF98-1334A2E3030F> Wedbush Securities does =nd seeks to do business with companies covered in its research reports. Th=s, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors sh=uld consider this report as only a single factor in making their investmen= decision. Analyst Certification I, Gil Luria, Aaron Turner, =ertify that the views expressed in this report accurately reflect my perso=al opinion and that I have not and will not, directly or indirectly, receive compensation or other payments in connection with my s=ecific recommendations or views contained in this report. Disclosure information regar=ing historical ratings and price targets is available at http://www.wedbush.com/ResearchDisclosure/DisclosureQ315.pd= <http://www.wedbush.com/ResearchDisclosure/DisclosureQ315.pdf> Investment Rating Sy=tem: Outperform: Expect the total=return of the stock to outperform relative to the median total return of t=e analyst's (or the analyst's team) coverage universe over the next 6-12 months. 8 EFTA_R1_01940075 EFTA02671128 Neutral: Expect the total return of the stock to perform in-line with the m=dian total return of the analyst's (or the analyst's team) coverag= universe over the next 6-12 months. Underperform: Expect the total return of the stock to underperform relative=to the median total return of the analyst's (or the analyst's team= coverage universe over the next 6-12 months. The Investment Ratings are b=sed on the expected performance of a stock (based on anticipated total ret=rn to price target) relative to the other stocks in the analyst's coverage universe (or the analyst's team coverage).*<=u> Rating Distribution Investment Banking Rel=tionships Outperform: 55% Neutral: 43% Underperform: 2% Outperform: 24% Neutral: 3% Underperform: 0% The Distribution of Ratings =s required by FINRA rules; however, WS stock ratings of Outperform, Neutra=, and Underperform most closely conform to Buy, Hold, and Sell, respectively. Please note, however, the definitions are not the same=as WS stock ratings are on a relative basis. The analysts responsible for=preparing research reports do not receive compensation based on specific i=vestment banking activity. The analysts receive compensation that is based upon various factors including WS total revenues, a portion =f which are generated by WS investment banking activities.4=pan> Wedbush Equity Resea=ch Disclosures as of November 4, 2015 Company=/p> Disclosure Bitcoin Investment Trust<=u> 1 Research Disclosure =egend 1 <=p> WS makes a market in the sec=rities of the subject company. 2 <=p> WS managed a public offering=of securities within the last 12 months. 3 <=p> WS co-managed a public offer=ng of securities within the last 12 months. 9 EFTA_R1_01940076 EFTA02671129 4 <=p> WS has received compensation=for investment banking services within the last 12 months.</=pan> 5 <=p> WS provided investment banki=g services within the last 12 months. 6 <=p> WS is acting as financial ad=isor. 7 <=p> WS expects to receive compen=ation for investment banking services within the next 3 months.<=u> 8 <=p> WS provided non-investment b=nking securities-related services within the past 12 months.=/span> 9 ap> WS has received compensation=for products and services other than investment banking services within th= past 12 months. 10 <=p> The research analyst, a memb=r of the research analyst's household, any associate of the research a=alyst, or any individual directly involved in the preparation of this report has a long position in the common stocks. 11 <=p> WS or one of its affiliates =eneficially own 1% or more of the common equity securities.<=span> 12 ap> The analyst maintains Contin=ent Value Rights that enables him/her to receive payments of cash upon the=company's meeting certain clinical and regulatory milestones. Price Chartsastrong> Wedbush disclosure price cha=ts are updated within the first fifteen days of each new calendar quarter =er FINRA regulations. Price charts for companies initiated upon in the current quarter, and rating and target price changes occurring=in the current quarter, will not be displayed until the following quarter.=Additional information on recommended securities is available on request.<=> * WS changed its rating system=from (Strong Buy/Buy/Hold/Sell) to (Outperform/ Neutral/Underperform) on J=ly 14, 20O9. Please access the attached hyp=rlink for WS Coverage Universe: http://www.wedbush.com/services/cmg/equities- division/research/coverage-lis= <http://www.wedbush.com/services/cmg/equities-division/research/c=verage-list> 10 EFTA_R1_01940077 EFTA02671130 Applicable disclosure informat=on is also available upon request by contacting Noeth Hing in the Research=Department at <tel:%28212%29%20938-9925> , by email to <mailto:[email protected]> , or the Business Conduct Department at (213) 688-8090 <tel:%28213%29=20688- 8090> . Y=u may also submit a written request to the following: Business Conduct Dep=rtment, 1000 Wilshire Blvd., Los Angeles, CA 90017.</=> OTHER DISCLOSURES RESEARCH DEPT. * <tel:%28212%29%20938-99=5> • www.wedbush.com <http://www.wedbush.com> EQUITY TRADING Los Angeles (213) 688-4470 <tel:%28213%29%20688-4470> / (800) 421-0178 <tel:%28800%29=20421-0178> * =QUITY SALES Los Angeles (800) 444-8076 <tel:%28800%29%20444-8076> CORPORATE HEADQUARTERS (213) 688-8000 <tel:%28213%29%20688-8000> The information herein is ba=ed on sources that we consider reliable, but its accuracy is not guarantee=. The information contained herein is not a representation by this corporation, nor is any recommendation made herein based on any pr=vileged information. This information is not intended to be nor should it =e relied upon as a complete record or analysis; neither is it an offer nor=a solicitation of an offer to sell or buy any security mentioned herein. This firm, Wedbush Securities, its o=ficers, employees, and members of their families, or any one or more of th=m, and its discretionary and advisory accounts, may have a position in any=security discussed herein or in related securities and may make, from time to time, purchases or sales thereof in the open market or otherwise. The information and expressions of op=nion contained herein are subject to change without further notice. The he=ein mentioned securities may be sold to or bought from customers on a principal basis by this firm. Additi=nal information with respect to the information contained herein may be obrained upon request. </=pan> chttps://m=ilfoogae.appspot.com/thender=aYn.eY2tqcGlIcmNIQGdtYWIsLmNvbQ%3D%3D&=ype=zerocontent&guid=S 2623790-c97b-4015-a70c-cd3493801fc4> 11 EFTA_R1_01940078 EFTA02671131