For the past year, there has been a great deal of excitement surrounding the prospect of crypto companies launching Initial Public Offerings (IPOs). The hype is understandable - the crypto space remains a nascent one, and companies going public essentially means that adoption could ramp up.
Things got especially exciting last year when Coinbase - one of the top crypto exchanges - announced that it would go public and list on the NASDAQ exchange. The exchange was listed this April, marking a new dawn for the crypto industry.
Coinbase Inspires Everyone
Months back, Coinbase hasn’t exactly been able to wow investors enough. However, the fact that the company is still listed means that there is a lot to be excited about. At the same time, several other crypto companies have remained committed to going public as well.
As explained, Coinbase has so far had a bit of a rocky road on the NASDAQ exchange. The company's stock was listed just before the crypto crash, and the market downturn has significantly affected its standing. For now, no one really knows how strong Coinbase’s stock is. It will take another market rally to see how viable a stock Coinbase is.
But, in the meantime, crypto companies are working on public listings. Mining firms appear to be leading the charge, with several of them gearing up for public listings. In July alone, two mining firms announced that they would be filing to go public.
Mining Companies Not Looking Back
The first was Stronghold Digital Mining - a Bitcoin mining firm based out of Pennsylvania. The company filed its S-1 form with the Securities and Exchange Commission (SEC), and approval from the agency will see the company list Class A common stock on the NASDAQ under the “SDIG” ticker.
Stronghold operates a mining outfit that is focused on sustainability and is vertically integrated. The company was founded earlier this year, completing two private equity security raises worth over $100 million. In its filing, Stronghold explained that it would use the generated funds to make several purchases, including new miners and power-generating assets.
“With part of the proceeds of this offering, we intend to procure an additional 27,900 miners, which we anticipate will bring our total hash rate capacity to approximately 3,000 PH/s by December 2021 and to over 5,300 PH/s by December 2022,” the filing outlined.
A day later, Argo Blockchain - a U.K.based company focused on crypto mining - announced that it would also apply for an IPO in the United States. In a confidential registration statement filed with the SEC, Argo proposed a dual listing and offering of American Depositary Shares. The listing is expected to happen in the third quarter of the year, barring any approval hiccup.
Argo has been listed on the London Stock Exchange since 2018. The company is yet to determine the number of shares it plans to list, or the share price. However, the company seems to be in solid hands, having mined 883 Bitcoin up until July 6 and holding 1283 Bitcoin at the time.
Lastly, Core Scientific - one of North America’s largest mining companies - announced that it would list on the NASDAQ as well. CNBC reported in July that the company had inked a massive $4.3 billion merger with Power & Digital Infrastructure Acquisition Corp — a special purpose acquisition company (SPAC).
As part of the merger, Core Scientific will be able to list and quickly join the NASDAQ. Company CEO Mike Levitt told CNBC that the company had already mined over 3,000 BTC since the year began, and it holds over 1,680 BTC. It is also hoping to increase its $60 million in revenues by 8 times before the year ends.
Others Are Following Suit
Beyond mining firms, several others in the space are also eyeing public offerings. Circle, the company behind the USDC stablecoin, announced in early July that it was also looking to go public.
The company, which is backed by names like Goldman Sachs and VISA, announced that it hopes to go public before the year runs to an end. It expects to be acquired by Concord Acquisition Group - a blank-check company - in a $4.5 billion deal and list on the New York Stock Exchange (NYSE) under the ticker “CRCL.” Under the terms, existing shareholders are expected to own about 86 percent of the new company.
Circle is already pretty big. The company has attracted $415 million in private investment and public equity financing. Combined with its convertible note financing and trust holdings, this brings Circle to about $1.1 billion in gross capital earnings.
Then, there’s Binance - the world’s biggest exchange and Coinbase’s biggest competitor. Changpeng Zhao, the company’s chief executive, confirmed last month that it was looking into an IPO for its American subsidiary, Binance US.
Binance US launched in 2019 and has already become one of North America’s largest exchanges. Speaking at the REDeFiNE Tomorrow 2021 virtual blockchain summit, Zhao confirmed that he understands the many sanctions that may befall Binance in the coming months. However, they remain determined to weather the storm.
The CEO pointed out that the main goal is to help Binance pivot from being a tech startup to a financial services company. While they haven’t had the best track record when it comes to cooperating with regulators, Binance sees an opportunity to improve on all fronts going forward. So, an IPO for its American subsidiary isn’t out of the question.
“Binance US is looking at the IPO route. Most regulators are familiar with a certain pattern, or having headquarters, having corporate structure. But we are setting up those structures to make it easier for an IPO to happen,” Zhao said.
Understandably, Binance will be considering an IPO - even though it’s not for its entire company. If Coinbase and Circle can do it, then there’s no reason why Binance can’t.