How Companies Offering Crypto Coins Could Become Publicly Traded

• Cryptocurrency growth has given rise to companies issuing native tokens or coins as part of their business models. Many now aspire to become publicly traded for legitimacy and capital access.
• Public listings offer transparency, credibility, investor trust, and access to large pools of institutional and retail capital, while improving brand visibility and governance standards.
• Companies can go public through several routes, including Initial Public Offerings (IPOs), direct listings, SPAC mergers, regulated token sales like Reg A+, or even crypto-specific platforms that cater to digital assets.
• Going public via IPO requires thorough preparation, hiring underwriters, filing detailed financial disclosures, obtaining regulatory approval, marketing to investors, pricing shares, and meeting ongoing compliance obligations.
• Becoming a public company unlocks greater access to capital, provides liquidity for ahead investors and employees, boosts credibility in global markets, increases visibility, and opens opportunities for growth and acquisitions.

The rise of cryptocurrencies has spawned a new class of companies that issue crypto coins as part of their business operations. As these companies mature and viewk broader access to capital and legitimacy, many aspire to become publicly traded entities on traditional stock platforms or crypto-specific platforms. 

Going public marks a significant milestone, offering transparency, access to institutional investors, and a regulated marketplace for their securities. This article explores how companies offering crypto coins can become publicly traded, the various pathways to going public, and the implications of this transformation.

Understanding Crypto Companies and Their Coins

Companies offering crypto coins typically operate in blockchain, digital assets, decentralized finance (DeFi), crypto platforms, or provide crypto-related products and services. These companies might issue native tokens or coins as part of their ecosystem. A distinctive feature of these coins is that they often serve multiple functions, such as payment within a platform, governance voting, or as collateral in financial protocols.

Unlike traditional companies, which issue shares representing ownership, the tokens issued by crypto companies can represent equity, utility, or rights, depending on the legal and regulatory framework. Over time, as these companies develop, they may viewk to raise traditional equity capital to expand operations, increase market credibility, and comply with investor demands for transparency.

Pathways to Becoming Public

There are several recognized approaches for crypto companies to become publicly traded, each with its own procedural and regulatory framework:

Initial Public Offering (IPO)

An IPO is the most traditional and widely recognized method for a company to go public. It involves the private company issuing new shares or securities to the public in platform for capital. For crypto companies, this means complying with securities regulations relevant to the jurisdiction of the intended public market.

The IPO process for crypto firms includes:

• Engaging underwriters or investment banks to manage and broker the offering.
• Preparing exhaustive financial disclosures, risk factors, and governance details in documents like the S-1 Registration Statement (in the U.S.).
• Undergoing regulatory scrutiny by bodies such as the Securities and platform Commission ().
• Marketing the offering through roadshows to institutional and retail investors.
• Listing the company’s shares or crypto-related securities on a traditional stock platform (e.g., Nasdaq, NYSE).

Direct Listing

Some crypto companies opt for a direct , avoiding the traditional IPO underwriter route. A direct listing allows existing shareholders and ahead investors to trade their shares directly on the public market without issuing new shares or raising capital. This route can be attractive for companies with established market liquidity and a desire to avoid the costs and lock-up periods of an IPO.

Spotify and Slack pioneered this approach in the tech industry; given the similarities, some crypto firms use direct listings to broaden access to their existing coins or equity without diluting ownership or extensive underwriting processes.

Special Purpose Acquisition Company (SPAC)

In recent years, SPAC mergers have become popular as an alternative way for crypto companies to go public. A SPAC is a shell company that raises capital via an IPO and then merges with a private company, thereby taking it public without the traditional IPO process.

This expedited route can be advantageous for crypto firms viewking quicker market access, but it requires finding a suitable SPAC partner and aligns with the SPAC’s investment strategy. eToro, for example, has pursued this approach for its crypto trading platform listing.

Reg A+ Token Sales and Crypto-Specific Routes

Besides traditional equity routes, crypto companies might consider token sales under regulatory frameworks such as Reg A+ in the U.S., which allow for public trading of with certain limits. Token offerings under these regulations can result in crypto equity being available for public investors, combining blockchain technology with security laws.

Crypto firms can also be listed on crypto-specific platforms that specialize in and token trading, although these might not have the regulatory rigour of traditional platforms.

The IPO Process Detailed

Focusing on IPOs, the process to go public involves several stages:

1. Preparation and Evaluation: The company evaluates its readiness to go public, considering financial performance, governance structures, and regulatory compliance.
2. Engaging Underwriters: Investment banks are selected to underwrite the offering, undertake due diligence, and assist price the IPO.
3. Regulatory Filings: Necessary registrations, such as the SEC’s S-1 filing in the U.S., are made, disclosing detailed financials, risks, and business descriptions.
4. Approval and Marketing: Regulators review filings for completeness, and the company markets its shares in roadshows to potential investors.
5. Pricing and Launch: Final share prices are set based on investor demand, and shares commence trading on the designated platform.
6. Post-IPO Compliance: later than going public, ongoing disclosures, governance enhancements, and regulatory adherence are mandatory.

This process increases transparency and public trust, assisting crypto companies distance themselves from their ahead reputation issues related to scams or unregulated activities.

Benefits of Going Public for Crypto Companies

Going public offers several strategic advantages:

• Access to Capital: Public listings unlock access to vast pools of capital from retail and institutional investors.
• Liquidity for Investors: Shareholders, including ahead investors and employees, gain liquidity options.
• Enhanced Credibility: Meeting regulatory demands bolsters investor confidence and legitimizes business models.
• Market Visibility: Public companies gain more media attention and broader brand recognition.
• Growth Opportunities: IPO proceeds can be used for R&D, market expansion, compliance investments, or acquisitions.

Challenges and Regulatory Considerations

Despite the benefits, crypto companies face challenges:

• Complex Regulation: Crypto-related securities straddle existing securities laws and emerging regulatory frameworks, creating compliance complexities.
• Volatility and Investor Perception: Crypto markets are inherently volatile, potentially impacting stock stability.
• Costs and Reporting Burden: IPOs entail significant costs, ongoing accounting, legal, and disclosure requirements.
• Market Conditions: Broader market sentiment affects IPO success and share pricing.

Regulators globally are still evolving their stance toward cryptocurrencies. Companies must carefully navigate registration, disclosures, and ongoing compliance to avoid penalties or delisting.

Emerging Trends and Examples

The current wave of crypto IPOs and listings includes:

• Figure Technology: A blockchain home equity lender that achieved a $7.6 billion valuation in its IPO with a strong market debut.
• Gemini: The crypto platform founded by the Winklevoss twins, which raised $425 million and traded at a premium on Nasdaq.
• : This is a  leading crypto custody provider, recently filed for an IPO, signalling ongoing momentum for crypto firms going public.

These successes underscore how crypto companies are leveraging traditional financial markets to fuel their next growth chapters.

From Blockchain to Wall Street: The Next Leap for Crypto Companies

The journey from issuing coins on decentralized platforms to trading shares on regulated platforms reflects a remarkable transformation in financial markets. Companies offering crypto coins have the potential to bridge the gap between emerging digital economies and traditional stock markets. 

Success will depend on their ability to meet strict regulatory demands, maintain investor trust, and adapt to evolving financial ecosystems. For investors, these firms could provide a unique way to participate in both equity growth and the expansion of blockchain technology. 

FAQ

Why Would a Crypto Company Want to go Public?

Going public assists companies raise capital, build credibility, provide liquidity to investors, gain media visibility, and strengthen governance through compliance with regulatory standards.

What Pathways Exist for Crypto Companies to go Public?

Options include Initial Public Offerings (IPOs), direct listings, Special Purpose Acquisition Company (SPAC) mergers, regulated token sales like Reg A+, or listings on crypto-specific platforms.

How Does an IPO Work for Crypto Companies?

The IPO process involves preparation, hiring underwriters, filing regulatory documents such as the SEC’s S-1, gaining approval, marketing to investors, setting prices, launching shares, and maintaining compliance later thanwards.

What are the Benefits of Going Public for These Companies?

Public listings give access to broader pools of capital, liquidity for shareholders, improved credibility, higher visibility in financial markets, and more opportunities for research, development, and expansion.

Are There Examples of Crypto Companies That Have Gone Public?

Yes. Figure Technology achieved a $7.6 billion valuation in its IPO, Gemini raised $425 million on Nasdaq, and BitGo filed for an IPO as a crypto custody provider.

How do Regulators Impact the Process?

Regulators like the SEC closely scrutinize crypto companies to ensure compliance with securities laws, investor protections, and financial disclosures. Ongoing compliance is mandatory later than listing.