Japanese exchange Coincheck is making waves in the cryptocurrency world with its plans to join Coinbase as one of the two publicly listed exchanges in the United States. The company is set to complete its listing on the Nasdaq via a partnership with special purpose acquisition company (SPAC) Thunder Bridge Capital Partners IV (THCP) by the second or third quarter of this year. This merger will lead to Coincheck Group BV being renamed Coincheck Group NV and listed on the Nasdaq stock exchange under the ticker symbol CNCK.
SPACs and Investor Concerns
Unlike Coinbase, Coincheck has chosen to go public via an SPAC, which means it will not have to go through the traditional initial public offering process. While this may seem like a shortcut to going public, it also raises concerns among investors. Historically, many SPACs have performed poorly in the public market, with some even leading to bankruptcy. In 2023, 21 firms that went public via SPACs ended up bankrupt, resulting in significant losses for investors. This track record of SPACs might make investors wary of Coincheck’s decision to take this route to public listing.
Coincheck’s Reputation and Regulatory Environment
Despite the risks associated with going public via an SPAC, Coincheck is one of the largest crypto exchanges in Japan, boasting 1.98 million verified users. The company has been in operation since 2014 and has built a solid reputation over almost a decade. However, Coincheck’s public listing plans come at a time when the SEC is increasing its regulatory scrutiny of the cryptocurrency industry. The SEC has recently targeted firms like ConsenSys, Uniswap, and Robinhood’s crypto arm for violating securities laws. SEC Chair Gary Gensler has emphasized that most cryptocurrencies are securities tokens and lack the necessary disclosures to protect investors.
Coincheck’s decision to go public via an SPAC is a risky move that could have both rewards and consequences. While the company’s solid reputation and large user base may appeal to investors, the history of SPACs and the increased regulatory scrutiny in the industry raise concerns. It remains to be seen how Coincheck will navigate these challenges and whether its public listing on the Nasdaq will be successful.
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