Cryptocurrency Exchange Bithumb Fires a Second Attempt at an IPO
The operator of the South Korean cryptocurrency exchange Bithumb plans to take the company public via an initial public offering (IPO), local reports indicate. To be successful, however, Bithumb has to overcome certain challenges, including taxation issues and investment protection.
Bithumb Considers Another IPO
According to the report from today, Bithumb Korea has selected the capital market company Samsung Securities as a listed host and has started the development work necessary for an IPO. Officials in South Korea interpret it as a significant step towards mass adoption for the exchange and digital currencies.
However, the company has to overcome several issues, especially with cryptocurrency taxation – an area in which South Korea has struggled previously. The latest information coming from the nation’s Finance Minister Hong Nam-ki urged the country to tax digital asset profits, but more details will come in July.
Due to the unclear stance on taxation and the difficulty of defining cryptocurrencies under the current legislation, Bithumb may not be fully qualified to go public yet, a government official said. He added that internal company issues and valuation problems could also cause complications if the exchange indeed goes for an IPO.
As of now, Bithumb Holdings (formerly known as BTC Holding Company) is the platform’s largest shareholder with a stake of nearly 75%.
This would be the firm’s second attempt in recent years to go public. In early 2019, the holding company BTHMB signed a binding letter of intent with another holding firm called Blockchain Industries, which trades publicly on the US over-the-counter markets under the ticker BCII. This so-called reverse merger is an unconventional way of getting into the public markets even faster than a regular IPO.
Bitmain Tried An IPO
Another popular cryptocurrency company that strived to go public on a few occasions is Bitmain. The latest attempt from the Beijing-based firm offering ASIC chip for Bitcoin mining came in mid-2019 as it planned an IPO for the second half of the year.
While that was not the first IPO effort from the Chinese company, this time, it had lowered its fundraising target substantially from $3 billion to somewhere between $300 million to $500 million.
Internal issues prevented Bitmain to succeed with its plan at the time. Although it’s still struggling with management problems, the company recently launched a new product, which could assist if it decides again to do an IPO.
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