Kraken Eyes $100 Million Fundraising Before IPO

Kraken, the prominent US-based crypto exchange, is reportedly planning to raise $100 million by the end of the year in a final funding round before an anticipated initial public offering (IPO) in 2025. According to Bloomberg News, the company seeks to leverage favorable market conditions to secure this funding and position itself for a successful public debut.

The exchange has been exploring IPO options since 2021, with former CEO Jesse Powell once suggesting that a $10 billion valuation might be an undervaluation. However, the IPO plans were delayed as Powell transitioned to the role of chairman in 2023, leaving Dave Ripley as the new CEO.

Kraken is currently looking to bring a “marquee” company onto its board. This strategic addition is seen as crucial to organizing and executing the IPO. Despite ongoing discussions, these negotiations have remained informal, with no formal documentation exchanged.

Although Kraken has not officially confirmed its IPO plans, it reiterated its commitment to “accelerating the global adoption of crypto” and remained focused on investing in this goal. The company’s steadfast dedication to this mission continues to attract attention within the crypto community.

Kraken’s path to an IPO is not without hurdles. The company is embroiled in a legal battle with the US Securities and Exchange Commission (SEC). The SEC has accused Kraken of operating as an unregistered securities exchange, broker, dealer, and clearing agency. Kraken has chosen to fight these allegations in court rather than settle.

This is not Kraken’s first run-in with the SEC. In 2023, the company settled charges related to its staking services, agreeing to a $30 million fine and ceasing these services in the US. The outcome of the current lawsuit could significantly impact Kraken’s IPO plans.

The prospect of a Kraken IPO has sparked significant interest in the crypto community. Market observers believe that a successful IPO could signal a positive shift in the regulatory landscape for digital assets. If venture capitalists back Kraken’s IPO, they might be anticipating a major turnaround in crypto regulatory issues, especially considering the ongoing legal challenges faced by other US-based exchanges like Coinbase.

Kraken’s ambitious fundraising and IPO plans highlight the dynamic nature of the crypto industry. As the company navigates regulatory challenges and seeks strategic partnerships, its actions could significantly influence the broader market and the future of digital asset regulation.