2020 was a whirlwind year for the crypto industry. The year began relatively slow, with assets performing usually and activities going as usual. However, thanks in large part to the coronavirus pandemic, investors began trooping into the crypto space as stocks and other investment assets began to tumble.
What followed was a flurry of investments from companies and individuals alike. At the end of the year, Bitcoin had broken its all-time high and as well on its way to new heights, while the rest of the market was more vibrant than anyone had envisaged.
As with every market performing well, several companies in the crypto space have begun to flirt with the prospects of an Initial Public Offering (IPO). Some have even made steps to start the listing process and get their stocks on exchanges. Let’s look at some of these firms and how they could get this done.
Note that this list includes both crypto firms as well as some traditional finance and tech firms that have made entries into cryptocurrencies.
Coinbase is the largest cryptocurrency exchange in North America and has held that position for a long time. The company’s status as a market leader is solidified, and it holds a significant amount of influence in the industry.
For months, many flirted with the idea of Coinbase listing in the United States. Thanks to the company’s healthy business model and friendly relationship with financial regulators, it seemed like a good fit for a public listing. It eventually took the plunge, announcing in December that it had filed a Form S-1 with the Securities and Exchange Commission (SEC) to go public.
Since then, reports have surfaced that the San Francisco-based exchange had tapped investment banking giant Goldman Sachs to lead its offering.
This month, Coinbase shared its IPO plans in a blog post, explaining that it wanted to pursue a direct listing for its Class A common stock. For now, its plans are still on hold as it looks to get a positive review from the SEC before it begins the process. However, the exchange is optimistic that the listing will happen this year.
Bakkt is essentially the Intercontinental Exchange’s crypto-facing arm of the parent company of the New York Stock Exchange. The firm scored a significant win in 2019 when it became the first to launch physically-delivered Bitcoin futures contracts - an incredibly lucrative venture.
With its standing as a pioneer crypto investment firm and its Wall Street connections, the company has also moved towards a possible public listing. The Wall Street Journal reported that Bakkt would merge with VPC Impact Acquisition Holdings - a special purpose acquisition company that focuses on mergers and buyouts.
VPC is a type of business entity that exists to buy or merge with other companies and allows them to be listed on exchanges without going through the usual IPO process. Under its deal with Bakkt, the company values the latter at $2.1 billion, with the partners raising an additional $532 million to build a retail-focused rewards and wallet app for Bakkt.
The deal is set to be completed by the year’s second half. Following the completion, the combined entity will be renamed “Bakkt Holdings Inc.,” and it will be able to list on the New York Stock Exchange.
Another exchange based in the United States, Gemini, was launched by the Winklevoss brothers of Facebook fame. Like Coinbase, the company has become famous for its regulatory-friendly approach to crypto operations. Also, like Coinbase, the firm appears to be considering a public sale.
Bloomberg reported two weeks ago that the company’s co-founders were examining strategies for a public listing. The report noted that the twins had several options available, including a direct IPO or merging with a blank-check firm to help get their stock to the public.
Gemini’s business has grown considerably over the past year, with the company revealing recently that it had passed the $10 billion mark in assets under custody. This month, it even announced a lucrative expansion to Singapore, which included support for the country’s fiat currency and establishing a regional office there. The move should help set it up for building its business in the Southeast Asian region.
eToro isn’t precisely a crypto company. The service provides stock trading to its investors, but it has been incredibly focused on crypto over the past few years. With the crypto market surging, reports of an IPO from eToro began to swirl too.
Last year, finance news sources reported that the Israeli-based company looked into a public listing in New York this year. It had reportedly been working with Goldman Sachs on the listing, with a possible $5 billion post-IPO valuation in the works.
While unconfirmed, the rumors suggested that eToro could also be looking to merge with a holding company - in the same manner as Bakkt - to get its IPO through. All in all, it was said to be working on a possible listing this year.
The firm has so far denied any IPO reports, but all of that could simply be a tactic to avoid any rumors or buzz that could jeopardize its plans. Considering that its business also grew considerably in the past year, anything really is possible.
With all of these and more, 2021 is set to be an exciting year for crypto firms. IPO rumors have been swirling, and companies in healthy-enough positions will be fancying their chances. While this isn’t to say that every firm will be successful, there is definitely a lot of excitement flying around.