United States-based cryptocurrency exchange Kraken is reportedly considering a funding round to raise more than $100 million for the firm ahead of a potential initial public offering (IPO). According to a June 6 Bloomberg report citing people familiar with the matter, Kraken was looking at a funding round expected to raise more than $100 million by 2025. The exchange reportedly said it was “always exploring strategic paths” toward global crypto adoption but did not specifically comment on a potential IPO.
Kraken is currently facing a civil lawsuit filed by the U.S. Securities and Exchange Commission (SEC) in November 2023. The regulator alleged that Kraken operated as an unregistered exchange and “made a business decision to reap hundreds of millions of dollars from investors” in violation of U.S. securities laws. Despite this legal challenge, Kraken seems to be moving forward with plans for expansion and growth.
In 2021, Coinbase made history by becoming the first crypto exchange to go public in the United States, listing shares of its stock on the Nasdaq. Before Coinbase’s IPO, Kraken had stated that if it pursued a public offering, it would do so through a direct listing rather than a special-purpose acquisition company. This decision reflects Kraken’s commitment to transparency and regulatory compliance in the cryptocurrency industry.
Despite the ongoing legal issues with the SEC, other players in the financial market are also making moves in the crypto space. Stock trading app Robinhood recently announced plans to acquire crypto exchange Bitstamp in a $200 million deal. If regulators approve the agreement, it could be finalized in the first half of 2025, further solidifying the growing intersection between traditional finance and the cryptocurrency market.
The potential funding round and IPO for Kraken come at a time of increased scrutiny and regulation in the cryptocurrency industry. As governments and regulatory bodies around the world grapple with how to oversee and regulate digital assets, exchanges like Kraken are navigating a complex and evolving landscape. The outcome of Kraken’s funding round and potential IPO could have significant implications for the future of the company and the broader cryptocurrency market. Investors and industry observers will be closely watching to see how Kraken’s strategic decisions unfold in the coming months.