Over the course of 2020, eToro has grown significantly, as Assia stated: “We have increased sales by more than 147% compared to the previous year,” he noted. This year, the mainstream and crypto bull markets were in full swing, along with “the greatest discussion we’ve seen in human history about the intersection of social media and investment platforms” – it all came together to form the what Assia calls “a perfect storm.” He added:
“We see immense interest from people around the world who want to participate in global markets. This was our original vision from 2017 when we started our business to open global markets to everyone so that they can trade and invest in simple and simple products in a transparent way. ”
Bitcoin (BTC), as well as the rest of the crypto market, had a stellar year in 2020 after quickly recovering from a sharp drop in prices, around the same time as rising COVID-19 concerns in March 2020. Mainstream markets also rebounded in In 2020, Bitcoin picked up speed at the end of the year, breaking its 2017 record high in December before rising significantly. The mainstream and crypto-bull markets continued until 2021.
On March 16, eToro announced plans to publicize its operations on Nasdaq through a special purpose vehicle (SPAC). Essentially, this is a kind of merger in which a private company merges with a specific company that is already listed (a SPAC company) and goes less directly to the stock exchange than in an initial public offering.
“If your company is growing faster than expected, it is always right to make sure that, as the largest company, as a company with public markets, you are fully prepared for the next phase of growth,” said Assia. “We are very excited about this next step in growth.”
Crypto Exchange Coinbase plans to go public via a direct listing on the Nasdaq exchange in April 2021. Alternatively, Diginex, a digital asset centric company, went public on Nasdaq via a SPAC in October 2020.
EToro has announced its intention to buy and merge with a SPAC called Fintech V, Assia said. “We’re going to partner with this company, actually buy this company and become a publicly traded eToro,” he said. The SPAC company, formerly known as Fintech Acquisition Corp V, is currently trading on the Nasdaq under the ticker FTCV.
“When SPACs announce the signing of business combination agreements, the SPACs will already be traded, giving private investors the opportunity to invest in SPACs under the SPAC ticker after the announcement,” said Assia.
Essentially, this avenue of going public offers interested parties the opportunity to invest indirectly in a private company immediately after it announces its intention to go public, even though it is technically not yet officially listed as a stock, according to Assia. The investor would buy the shares in the participating SPAC, which would eventually become the shares of the private company. In general, when a company went public through an IPO, investors would have to wait for the private company’s shares to list and then buy their shares when they do.
Related: Catalytic Event or Unbridled Optimism? Coinbase is approaching public listing
“In the next few months, when we finalize the merger agreement, we will basically become the publicly traded company on the Nasdaq,” said Assia. Although Assia said his company had not yet set a new ticker name at the time of the interview, eToro will not keep FTCV as a ticker. “We didn’t openly choose it,” he said. “We cannot share what we have not yet decided, for example if you are pregnant with a child,” he said with a laugh.
What will change for eToro compared to ongoing operations in public? “I think most of our day-to-day work will remain largely the same,” said Assia, citing customers, continued technological advancement and products as areas of eToro’s attention. He added:
“When we close the deal and bring in the $ 650 million PIPE [private investment in public equity]In addition to having a maximum SPAC of $ 250 million on the company’s balance sheet, we have a very strong balance sheet to accommodate potential acquisitions and more aggressive geographic expansion – whether they are aggressively expanding in the US or other markets. ”
He concluded that going public with a balance sheet of over $ 1 billion “will allow us to be even more aggressive when we think of eToro growing”.
In the past few months, talk of crypto companies going public has made some headlines. The crypto and financial asset trading platform eToro is one of the newest crypto companies looking to go public. The outfit’s CEO, Yoni Assia, recently explained the reasons behind eToro’s move in an interview with Cointelegraph.