Cryptocurrency exchange and blockchain explorer Blockchain.com has initiated talks with US banks to explore a potential Initial Public Offering (IPO) as early as this year, according to industry reports dated April 19. While discussions remain preliminary, a successful IPO would position Blockchain.com as the second US-listed crypto exchange after Coinbase.
Market Context: From Coinbase’s Milestone to Current Challenges
Coinbase made history in April 2021 by debuting on NASDAQ at $381 per share, peaking at a $100 billion valuation. However, volatile crypto markets have since impacted its performance, with shares closing at $147.13 on April 20—a 61.38% decline from its opening price.
Blockchain.com’s Growth Metrics
- Revenue: Projected $18.9 billion in 2021 (up from $15 billion by October).
- User Base: 37 million verified users and 82 million Bitcoin wallet addresses.
- Transaction Volume: Over $1 trillion in total platform transactions.
- Funding: Secured a Series D round in March 2022 at an $18 billion valuation, led by Lightspeed Ventures and Baillie Gifford & Co.
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Operational Focus and Market Position
Blockchain.com operates:
- Retail Services: Wallet management and daily trading (~$15 million volume).
- Institutional Offerings: Crypto derivatives, loans for hedge funds, and mining firms.
Despite its scale, analysts note its lower visibility compared to Coinbase, attributed to its UK headquarters and emphasis on wallet/institutional services.
Regulatory Hurdles: A Critical Path to IPO Success
Compliance Challenges in the US and UK
- UK Withdrawal: Blockchain.com retracted its temporary registration with the UK’s Financial Conduct Authority (FCA) in March 2022, opting instead for a Lithuanian license to maintain EU operations.
- Binance.US Parallels: Competitor Binance.US also eyes an IPO but faces regulatory scrutiny over independence from its global parent.
"Crypto firms must prioritize compliance to unlock public markets," says Cai Kailong, Senior Researcher at Renmin University’s FinTech Institute. "Blockchain.com lacks Coinbase’s first-maker advantage and must address stricter investor expectations."
FAQ: Blockchain.com’s IPO Prospects
Q: How does Blockchain.com’s valuation compare to Coinbase?
A: At $18 billion, it’s significantly lower than Coinbase’s peak $100 billion, reflecting market maturity and higher compliance barriers post-2021.
Q: What risks could delay the IPO?
A: Regulatory approvals, especially in the US, and proving operational independence from global entities are key hurdles.
Q: Why did Blockchain.com pivot to Lithuania?
A: The UK’s FCA requires stringent AML compliance, prompting a shift to EU-friendly licensing.
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Conclusion: A Test Case for Crypto’s Mainstream Future
Blockchain.com’s potential IPO underscores the crypto industry’s push for legitimacy amid evolving regulations. While its $18 billion valuation signals investor confidence, success hinges on navigating compliance—a lesson for peers like Binance.US. As markets demand transparency, exchanges must balance growth with governance to sustain long-term viability.