When Coinbase went public in April 2021, its IPO was regarded as a milestone event. While the value of cryptocurrencies has since declined, more firms are following Coinbase’s lead to go public.
By going public, firms are able to raise funds for their expansion. IPOs are also a way for private investors to cash out their investments in startups.
Here are some of the leading crypto firms looking to go public soon.
Coinbase rival, Kraken, has plans to IPO in the second half of 2022.
The CEO, Jesse Powell, has previously indicated that the company is weighing its options. In particular, the firm is confronting whether to do a direct listing to the public like Coinbase did, or a more traditional bank managed IPO.
Kraken has been deterred from a direct listing based on the performance of Coinbase after going public using the format. Valued at $68 billion after it went public, Coinbase is currently valued at $50 billion.
A direct listing avoids Wall Street banks, and is a cheaper option, even though the process is less stable.
The latest crypto firm to announce plans of going public is Circle, the firm behind the USDC stablecoin.
Just last week, Circle announced it will go public as part of a special purpose acquisition company (SPAC), Concord Acquisition Corp.
A special purpose acquisition represents another format that firms are selecting to go public. A SPAC is a shell company that is formed to raise funds.
Speaking about taking this approach, Jeremy Allaire, CEO, Circle, recently said:
“Through this strategic transaction and ultimate public debut, we are taking an even bigger step forward, with the capital and relationships needed to build a global-scale internet financial services company that can help businesses everywhere to connect into a more open, inclusive and effective global economic system.”
– CEO, Circle
The USDC stablecoin has a market valuation of $26 billion, and is the biggest after Tether ($62 billion).
In May 2021, Ripple CEO, Brad Garlinghouse, indicated that it is “highly likely” the company would go public.
Ripple, the company behind the XRP cryptocurrency, offers financial services via blockchain to process payments especially for banking insttitutions.
However, since December 2020, Ripple has been embroiled in a legal tussle with the Securities and Exchange Commision of the United States (SEC).
The SEC accuses Ripple, and its founders, of raising $1.3 billion worth of XRP, which the SEC deems an unregistered security.
The SEC contends that XRP is not a currency but a security.
Brad Garlinghouse points out that Ripple’s IPO plans will need to wait for the resolution of the SEC probe.
Since July 2020, crypto lending service BlockFi has had the intention of going public.
This was made public by its CEO, Zac Prince, after the FTX-owned company listed an opening for an experienced CFO.
In March 2020, BlockFi raised $350 million in a venture capital round valuing the company at $3 billion. Prince confirmed that the company is “actively working on public market readiness.”
While these are some of the more notable crypto firms with public market intentions, they are not the only ones. Apinify, Bakkt, and Sofi are also reported to have IPO plans which should see even more firms take this route as well.
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