By Alexander Osipovich
Japanese cryptocurrency exchange Coincheck Group rallied as it went public on the Nasdaq Stock Market on Wednesday, becoming the second crypto exchange listed in the U.S. after Coinbase Global.
Shares of Coincheck were up 8.4% in midday trading, benefiting from a broad upswing in bitcoin and other digital currencies. The crypto exchange went public by merging with a special-purpose acquisition company, Thunder Bridge Capital Partners IV, and taking over the SPAC's spot on the Nasdaq.
Coincheck announced the $1.3 billion merger in March 2022, but it took more than two years to complete due to a lengthy review process by the Securities and Exchange Commission.
Other crypto firms that attempted to go public through SPAC deals during the past three years, such as Bullish Global and Circle Internet Financial, called off the deals after struggling to win SEC approval. Outgoing SEC chair Gary Gensler repeatedly criticized the crypto industry for being rife with fraud and manipulation, and the agency sued some of the largest U.S. crypto firms under his leadership.
Coincheck doesn't serve U.S. customers and is subject to Japanese crypto regulation. It is one of Japan's biggest crypto exchanges, with just over two million customers. The company is domiciled in the Netherlands but its main asset is its Japanese exchange.
In January 2018, Coincheck lost $530 million in customer assets in what was then the largest crypto hack in history. The theft spurred Japanese regulators to stiffen their oversight of the country's crypto industry. Following the hack, Coincheck was acquired by Monex Group, a Tokyo-based financial services firm, which remains its parent company today.
U.S. stock exchanges list some companies that allow their customers to buy crypto, such as Robinhood Markets and Block, but these companies aren't mainly focused on digital-currency trading. Diginex, a Hong Kong-based crypto-exchange operator, went public on Nasdaq via a SPAC deal in 2020 but was later delisted.
More crypto companies are likely to go public as the SEC changes its stance on digital assets with the incoming administration of President-elect Donald Trump, said Eric Risley, founder of Architect Partners, an advisory firm specializing in digital-asset deals.
"I'd bet more on 2026 IPOs than 2025, for a variety of reasons, but directionally the crypto industry is going the right direction at the moment to open up this path as viable," he said.
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(END) Dow Jones Newswires
December 11, 2024 12:11 ET (17:11 GMT)
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