Crypto-mining giant Bitfury is considering launching an initial public offering; it would be Europe’s first large listing from the cryptocurrency industry. Bloomberg reports Bitfury is in communication with a number of global investment banks as it explores making its trading debut in Amsterdam, London or Hong Kong in 2019.
“The blockchain-technology company is exploring a range of options and could decide to raise debt financing or sell a minority stake,” one anonymous source told Bloomberg. “No final decisions have been made. If Bitfury goes public in the next two years, it could seek a valuation of $3 billion to $5 billion though numbers are early estimates and could change depending on markets and the industry.”
Interestingly, Beijing-based Bitmain, the world’s clear-cut leader in the world of crypto mining, is expected to raise no more than $3 billion in its IPO in Hong Kong.
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Bloomberg notes that large investment banks have historically been reluctant to enter into the cryptosphere due to a lack of regulation. Market volatility is also a concern, as cryptocurrency’s total market cap has fallen more than $600 billion this year.
However, institutional investors appear to be entering into the space at an increasing rate in recent weeks. For example, 2 weeks ago, one of the world’s largest financial services providers, Fidelity Investments, announced the launch of Fidelity Digital Assets Services LLC. The company aims to offer “enterprise-quality” custody and trade execution services for digital assets, aka cryptocurrencies, to institutional investors, including hedge funds, family offices, and market intermediaries.
A few days later, Goldman Sachs Group Inc. and former Goldman partner Mike Novogratz executed a joint $15 million investment into cryptocurrency custodian BitGo Holdings Inc.
“We believe that a custody offering is a logical precursor to digital asset market making,” Goldman spokesman Michael DuVally said.
To date, BitGo has raised aproximately $70 million in fundraising rounds. The company reports to offer services for more than 75 coins and holds more than $2 billion in assets.
Meanwhile, Bitfury has posted $450 million in revenue over the last 12 months. The company was co-founded in 2011 by Valery Vavilov and Valery Nebesny, who share a majority stake. Bitfury is based out of London and Amsterdam, and specializes in making crypto-mining gear for retail use, in addition to running its own private mining operation. Bloomberg reports that since the company’s inception, Bitfury has branched out into numerous other blockchain businesses: the company also makes computer chips for mining machines and software for large companies and government entities.
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