The 4 Big-Name Crypto Companies Planning Public Offerings in 2021
Crypto companies are abuzz with talks of crypto IPOs. But let’s put this in context.
On January 7th, 2021, crypto became a trillion-dollar asset class for the first time in history. The combined market cap of all cryptocurrencies added up to one trillion dollars. A momentous achievement!
It’s not just prices that are going up either. As new money flows into crypto, all of the best crypto companies are getting bigger as well. That growth is bringing us to the point where it makes sense for some of these companies to offer cryptocurrency IPOs (the purchase of previously private shares to the public).
In this article we’ll look at the proposed Coinbase, BlockFi and Bakkt IPOs. These three crypto companies have all announced that they’re planning to go public in 2021. At the end of the article we’ll announce one more company that will be added to that list. We haven’t been able to publicly share these details until now, which means that you’ll be the first to hear about it!
1) Coinbase IPO
Coinbase is arguably the most well-known cryptocurrency company. Coinbase has a dead-simple onboarding platform for new investors where you can buy Bitcoin and other cryptocurrencies with a debit card or bank transfer. For advanced traders there is Coinbase Pro, a popular crypto exchange with an order book and various order types.
According to a recent article by NASDAQ, Coinbase has 43 million users who live in more than 100 countries. The platform is currently holding approximately $25 billion in crypto-assets and employs more than 1,000 people.
Given the size of the platform, it’s no surprise that Coinbase wants to go public. They could use the additional funds in several ways:
- Infrastructure improvements. Coinbase is famous for going offline during big swings in the Bitcoin price
- Better financial services. Coinbase could build out new financial products like interest on BTC deposits or a deeper integration with DeFi
- Blockchain developer fund. Square, the company behind the Cash App, funds a developer who is improving the Bitcoin mining pool software.With all of the capital that an Initial Public Offering (IPO) will bring, Coinbase could do the same
Coinbase will list somewhere around 115 million Class A shares on the NASDAQ under the ‘COIN’ ticker, and the IPO will be a direct listing, meaning that initial investors will all be able to participate at the same price. The IPO is slated to go live later this month, and the initial, nominal value of the shares is likely to be somewhere around $8.20.
In terms of valuation, the last time Coinbase raised money was through a final Series E funding round in 2018. At the time Coinbase was given a valuation of $8 billion, but presumably that valuation has increased in the last three years.
We’ll be keeping a close eye on the Coinbase IPO since this will be the largest crypto company to go public (and possibly the first, depending on when the Initial Public Offering takes place).
2) BlockFi Crypto
BlockFi is a type of crypto bank. Unlike a traditional bank, however, BlockFi actually pays interest on deposits. For example, as of publication the interest rate on USDC deposits is 8.6% and Bitcoin deposits can earn 6%. Real-time interest rates on BlockFi are available here.
In addition to interest on deposits, BlockFi also offers crypto-backed loans. Users can deposit Bitcoin and use it as collateral to take out a loan.
BlockFi was founded in 2017 and has a good reputation in the cryptocurrency space. So far, BlockFi has already raised $158 million through various funding rounds, and they plan to do a series D round before going public.
If the BlockFi does end up going public it will probably do so via a SPAC, sometime in Q3 or Q4 of 2021. SPAC stands for Special Purpose Acquisition Company; a “blank check” company that exists on paper but doesn’t have a real business or product.
This blank check company raises money by going public then uses that money to acquire another company. By merging with an existing business, a SPAC can bring the company into the public markets without an official BlockFi IPO.
3) Bakkt IPO
Bakkt should have a special place in the hearts of every crypto investor who was around for the 2017 peak and subsequent bear market. If you remember, Bakkt was going to save crypto! As soon as the Bakkt derivatives platform came online the buyers would return, the price of Bitcoin would quickly blow past its previous all-time-high and everything would be right with the world.
None of that happened.
Instead, Bakkt launched and… Nothing happened. In fact, nothing happened for a long time. Since its launch Bakkt has struggled to generate much interest from traders. Even now, Bakkt is not generating significant volume. As of January 19th, 2021, the 24 hour futures trading volume on the CME exchange is $4 billion. On Bakkt the trading volume is only $60 million.
Despite this lack of liquidity, The Block has reported that Bakkt will be going public via a SPAC in 2021. The initial valuation for Bakkt is $2.1 billion, which should give it plenty of ammunition to build out its business following a Bakkt IPO.
4) Exodus Public Offering
Coinbase, Bakkt and BlockFi are not the only companies going public in 2021. We’re pleased to announce that Exodus sold $75 million in shares through a Regulation A+ offering, and that these shares are currently listed on the tZERO ATS (Alternative Trading System).
We also issued EXIT Tokens, that are digital representations of the shares, viathe Algorand blockchain.
But it doesn’t end there. Exodus shares can be purchased with Bitcoin, Ethereum, and USDC within the wallet interface, and secondary shares can be purchased on tZERO.
To learn more, visit our investor portal at http://www.exodus.com/investors.
4) Will Crypto IPOs be a success?
The lack of a Bitcoin ETF is one of the key reasons these crypto IPOs could be successful. Institutional investors who want crypto exposure, but don’t want to hold BTC, will be able to buy Coinbase or Bakkt. The bigger the cryptocurrency ecosystem becomes, the better these companies will do. And Exodus will be right up there with them.
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