Bitcoin Futures Exchange, Bakkt, Rumored To Be Pursuing Merger and a Possible IPO
The crypto space is as vibrant as it’s ever been, with activity in the industry moving quickly. However, while assets are breaking records almost daily, companies are also setting milestones.
The latest comes from cryptocurrency exchange Bakkt, which could be prepping up for an Initial Public Offering (IPO).
Synergies Going Forward
Bakkt, the regulated crypto trading platform partly owned by the Intercontinental Exchange, works on a possible merger with VPC Impact Acquisition Holdings, Bloomberg reports. Both companies are said to be in advanced talks, with a likely announcement coming next week.
VPC Impact Acquisition Holdings is a Chicago-based company that specializes in mergers, acquisitions, and corporate reorganizations.
The company is closely affiliated with Victory Park Capital, an alternative investment firm. Its company profile on Bloomberg shows that it focuses on acquiring companies and assets through various means.
As Blomberg reported, the Bakkt merger could be a potential $2 billion deal, setting the groundwork to go public.
It hasn't been all rosy for Bakkt since it launched. Bakkt rolled-out its physically-delivered Bitcoin futures contracts in September 2019, much to fan frenzy. While the contracts had a bit of a rocky start, they gained traction slowly before fading away. With institutional investment pouring into the crypto market last year, Bakkt’s numbers have been quite impressive.
This past week alone, the company’s futures contracts drove $286 million in transaction volumes.
IPO Craze Floods the Crypto Space
Bakkt’s rumored IPO is only the latest in the line of crypto companies possibly looking to go public. Last month, Coinbase, the largest crypto exchange in North America, announced that it had filed a Form S-1 with the Securities and Exchange Commission (SEC), intending to list on public exchanges.
The exchange has not made any updates to the process, claiming at the time that its listing will depend on regulators’ reviews of its prospectus filing. There are rumors in the press that the Silicon Valley firm had tapped Goldman Sachs to lead its public offering.
While Coinbase’s last capital raise saw it valued at $8 billion, the market has since matured – and so has the exchange. Analysts from Messari believe that Coinbase is now worth an impressive $28 billion, thanks to growth in its subsidiary businesses like professional trading and custody.
Asides from Coinbase, eToro, a crypto-friendly trading app, has also been rumored to be prepping for a public offering this year. Israeli-based media outlet Calcalist reported earlier this week that eToro targets an IPO in Q2 2021 and has been working with the London Stock Exchange’s “Elite” program to prepare for its listing. This is coming off a healthy 2020 where the firm recorded revenues of $500 million and quintupled its customer base.
Zero-fee trading app Robinhood is also prepping for its public offering. The company had reportedly also tapped Goldman Sachs to lead the offering and was looking to hit a $20 billion post-listing valuation.