VersaBank (VBNK) was up more than peers yesterday after announcing it will serve as the custodian for Stablecorp’s QCAD, the first regulatory compliant Canadian-dollar stablecoin. With no QCAD in circulation yet, the financial impact isn’t clear…

… so yesterday’s bid was likely driven by optimism around the digital asset strategy, with big names like Circle and Coinbase backing Stablecorp. Success as a custodian and deposit token issuer would add a low cost funding source…

… which could support growth in the core business at better margins, depending on the durability of these balances.

Importantly, any incremental wins here are upside - as we don’t include this nascent line of business in our valuation analysis.