Ben Strack

Bitdeer has become one of the biggest bitcoin miners in the world by market capitalization just three months after going public.&nbsp;



The company’s stock began trading on Nasdaq on April 14 <a href="https://blockworks.co/news/bitdeer-to-go-public">via a special purpose acquisition company (SPAC) merger</a> with Blue Safari Group Acquisition Corp.&nbsp;



Bitdeer CEO Matt Linghui Kong told Blockworks in an email that the company’s listing provides it with “increased visibility and credibility.”&nbsp;



“We strategically deployed five mining data centers, including two mining data centers in Norway and three more in the US, with expansion plans to create more local jobs and build up more key positions in the company based in the US,” he added. “Becoming a public company will enable us to reach these twin goals.”



The firm’s ride on the stock market hasn’t been without its bumps. Bitdeer’s stock price closed at $7.03 on its first day of trading and dropped to as low as $4.60 in the following weeks, according to Peter Stoneberg, a managing director at crypto advisory firm Architect Partners.



But the stock was trading at roughly $14 on Monday morning, up about 31% from a month ago.&nbsp;



Bitdeer’s market capitalization stands at $1.56 billion, behind only Marathon Digital and Riot Platforms among publicly traded miners. The stock prices of Marathon and Riot are up 70% and 52%, respectively, over the past month.



“Wall Street was struggling to find stocks that get you crypto exposure, and Bitdeer cornered a big part of crypto mining,” OANDA senior market analyst Ed Moya said. “A lot of crypto traders like the Ordinals protocol that could help with growth for NFTs and meme-token transactions.”&nbsp;&nbsp;



Bitdeer’s low public float — referring to the number of shares available to the public — has contributed to its stock price jump, Stoneberg said.



“Only 24% of the company&#8217;s outstanding shares are held by the public, and the average daily trading volume is only about 100,000 shares,” Stoneberg explained. “This low float makes the stock more volatile, as news can drive the price up or down significantly.”



<h2 class="wp-block-heading">Eyeing hash rate growth, global expansion&nbsp;</h2>



The hash rate for Singapore-based Bitdeer, founded in 2018, stood at 18.8 exahashes per second (EH/s) at the end of June. And the amassing of that computing power has caught the eye of stock watchers in the market.



The company’s revenue generation across self-mining, cloud mining and hosting services give it “an attractive business model,” Stoneberg said.&nbsp;



Bill Cannon, head of portfolio management at Valkyrie, said Bitdeer’s continued mining infrastructure build-out worldwide has also been a boon to the stock’s recent rise.&nbsp;



Bitdeer is a top-10 holding in Valkyrie’s Bitcoin Miners ETF (WGMI).&nbsp;&nbsp;



Bitdeer said earlier this month that its 100 megawatt (MW) mining data center in Bhutan — set to boost its hash rate by 3.3 EH/s — is expected to begin operating this month. The plans to complete construction come after 10,000 mining machines arrived at the facility last month, according to Linghui Kong.&nbsp;



The data center will be the company’s first in Asia and will operate at carbon neutrality as a result of Bhutan’s hydroelectric power generation, the Bitdeer CEO said.



Read more: <a href="https://blockworks.co/news/bitdeer-bhutan-mining-project">Bitdeer counting on big funding for Bhutan mining project — Is it plausible?</a>



The company has begun constructing a 175 MW immersion cooling data center at its facility in Norway. Completion of that project is expected in 2025.&nbsp;



“This projected rise in production and efficiency will compete with much of the larger industrial players in the sector while carrying positive momentum into the halving period next year,” Cannon told Blockworks.&nbsp;



Bitdeer also recently announced a share buyback program of up to $1 million.&nbsp;



“This is a positive signal to the market, as it shows that the company is confident in its future prospects,” Stoneberg said. “However, the buyback program is not very material, given Bitdeer&#8217;s…market capitalization.”



<h2 class="wp-block-heading">More crypto firms to go public?</h2>



Bitdeer’s initial public offering (IPO) is similar to other SPAC deals that have been popular in recent years, Cannon said. Recently, SPAC-type IPOs have become more rare due to macroeconomic and regulatory conditions.



There were 613 SPAC IPOs in 2021, but only 86 in 2022, <a href="https://www.statista.com/statistics/1178249/spac-ipo-usa/">according</a> to Statista. The pace has slowed even further this year — the first five months of 2023 saw the debut of just 14 SPACs.



Though such deals have declined, Cannon added, more could be on the horizon as crypto enjoys more institutional attention.&nbsp;



Stablecoin issuer Circle <a href="https://blockworks.co/news/circle-kills-spac-plans">canceled</a> its SPAC deal in December, <a href="https://blockworks.co/news/circles-public-listing-plans-undeterred">but still intends to go public</a>.&nbsp;



Cloud mining firm BitFuFu delayed its IPO plans via a merger with SPAC Arisz Acquisition Corp in February. A couple months later, Blockchain platform Chia Network in April submitted to the SEC a draft registration statement for a proposed IPO.&nbsp;&nbsp;&nbsp;



Other companies have gone ahead this year. Bitcoin ATM operator Bitcoin Depot went public earlier this month after combining with SPAC <a href="https://www.globenewswire.com/Tracker?data=MBPabHr6KJN0S8HGxgw_5tY7yIAn7lRlfevkiNcMs8rxDDcY29MUgaEmddGl-3KCmqB1LUfd-y1aQ6Y2YSqMETk6EPcPCa3TeAwIFuBUEeQ=">GSR II Meteora Acquisition Corp</a>. The company’s stock price closed at $3.61 on its opening day of trading July 3.&nbsp;



The stock was trading $3.23 Monday at 12 pm ET, down about 5% on the day.



<h2 class="wp-block-heading">Mining stocks at a glance</h2>



After a rough 2022 for crypto, the mining sector has separated itself by improving productivity strategies and working within the current regulatory and infrastructure environment, Cannon noted.&nbsp;



Read more: <a href="https://blockworks.co/news/bitcoin-miners-ai-computing">Bitcoin miners seek revenue with AI, high-performance computing</a>&nbsp;



Crypto mining stock prices were collectively up 54% during the second quarter of 2023, according to an Architect Partners report.&nbsp;&nbsp;



By comparison, bitcoin (<a href="https://blockworks.co/price/btc">BTC</a>) and ether (<a href="https://blockworks.co/price/eth">ETH</a>) prices gained 83% and 18%, respectively, during the second quarter.&nbsp;&nbsp;&nbsp;&nbsp;



“Innovation in electricity consumption and production not only benefits the bitcoin mining ecosystem, but other sectors like [artificial intelligence] and social media-related applications that require more heavy data capacity in the near term,” Cannon said.



Updated July 18, 2023 at 5:15 pm ET: A previous version of this article stated bitcoin mining rig developer Bitmain owned Bitdeer. Bitdeer is a spin-off of the company, but not owned by Bitmain.



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As SPAC IPOs have grown scarce, Bitdeer’s success bucks a trend

The latest SEC action against publicly traded company Coinbase has not deterred crypto payments tech company Circle — or others — from continuing its quest to go public.



Still, the path for most companies mulling a public listing is likely to be tough in the current environment, an industry executive said.&nbsp;&nbsp;



After revealing a plan to become a public company by merging with a special purpose acquisition company (SPAC) in 2021, Circle CEO Jeremy Allaire said in a December 2022 tweet that his company “did not complete SEC qualification in time.”



Executives said earlier this year <a href="https://blockworks.co/news/circle-stablecoin-usdc-public-hiring">going public remained a key part of Circle’s strategy</a> — a plan confirmed again this week by a company spokesperson and a recent job posting.&nbsp;



&#8220;We are not prepared to put a specific deadline on the decision, but we will be taking steps to continue our journey to go public as soon as practicable,&#8221; a Circle spokesperson told Blockworks.



A Circle job listing posted two weeks ago for corporate counsel also makes reference to these plans.



The professional would be tasked with “assisting with potential going public SEC process” as well as “supporting the building out of our public company policies, practices and processes,” the job description states.



Circle’s plans remain despite the SEC’s latest lawsuit against Coinbase, which has been a public company for more than two years.&nbsp;



Coinbase went public in April 2021 after the SEC “declared effective” its registration on Form S-1 — the initial registration document for new securities. But the regulator <a href="https://blockworks.co/news/sec-sues-coinbase#">alleged in a complaint Tuesday</a> that Coinbase has been operating as an unregistered exchange — charges the company has denied.



Read more: <a href="https://blockworks.co/news/coinbase-sec-hypocrisy-not-really">Coinbase Was Allowed to Go Public, Then Got Sued — Hypocrisy? Not Really, Some Say</a>



“Declaring effective a Form S-1 registration statement does not constitute an SEC or staff opinion on, or endorsement of, the legality of an issuer’s underlying business,” the SEC complaint states.&nbsp;&nbsp;



Galaxy Digital’s plans to go public by becoming a Delaware-incorporated company and subsequently list on the Nasdaq — <a href="https://blockworks.co/news/galaxy-public-sec-earnings">reiterated in March</a> — also remain, a spokesperson said Friday. The company’s latest amended registration was submitted to the SEC in February and is currently under review.



But the current environment could pose hurdles for most companies looking to go public, said Eric Risley, founder of crypto advisory firm Architect Partners.&nbsp;



“The fundamental requirements for a viable [initial public offering] is strong business momentum and a positive, or at least stable, business environment,” he told Blockworks in an email. “While each company is unique, it’s safe to conclude that neither of these requirements are present today. Until that changes, the IPO path will likely be postponed for most companies.”



<h2 class="wp-block-heading">Kraken job posting also hints at continued IPO plans</h2>



Crypto exchange Kraken also hinted at its continued quest to go public in a recent job posting for a senior corporate and securities counsel.&nbsp;



It lists “public company preparedness” as one of the matters Kraken’s legal team is focused on, adding that “public company reporting experience” is a preferred skill for candidates.



A company spokesperson did not return a request for comment.&nbsp;



Kraken mulling an IPO is nothing new.&nbsp;



A Kraken spokesperson told Blockworks in June 2021 that the crypto exchange might consider going public in 2022.&nbsp;



“At this point no decision has been made and we&#8217;re fully focused on scaling our business, filling key roles and making sure we&#8217;re giving clients the best experience and products in a time of unprecedented growth,” the representative added at the time.



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Circle’s public listing plans undeterred by latest SEC actions

Sebastian Sinclair

<div id="highlights-block_623a95c78bd01" class="highlights">
 <ul>
 <li>The prePO platform will provide retail investors the same access as institutions and hedge funds get to speculate on pre-initial public offerings</li>
 <li>Funding will go toward further development of the platform ahead of its expected launch in Q2, 2022</li>
 </ul>
 
</div>



Decentralized protocol prePO said Wednesday it had closed a $2.1 million strategic funding round, led by Republic Capital and IOSG Ventures, ahead of its upcoming trading platform launch in Q2.



In a press release shared with Blockworks, prePO said it would use the funding to bolster its efforts to &#8220;democratize&#8221; pre-public investing. The fresh funding adds to the protocol&#8217;s previous $1.1 million seed money in July of 2021.



The platform, which is not yet live, seeks to provide exposure for retail investors to speculate on the valuation of pre-IPO companies or pre-token projects. The first version of the platform is expected to launch on Ethereum scaling solution Arbitrum shortly after its token launch in the coming months.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">&#8220;We currently live in a society of financial exclusion,&#8221; the protocol states in its <a href="https://docs.prepo.io/basics" target="_blank" rel="noreferrer noopener">online documentation</a>. &#8220;All investors&nbsp;miss out on opportunities due to there being limited places on a cap table.&#8221;</blockquote>



Participation in the round came via MEXC, AscendEX, GCR, Shima Capital, Caballeros Capital, Dexterity Capital, HoneyDAO, NeptuneDAO; founders from Gnosis, 1inch, Moonbeam, Zapper, Gelato also participated, among others.



“We’re incredibly grateful to have such an all-star group of backers,&#8221; prePO founder Xavier Ekkel said. &#8220;Their industry expertise, deep networks, funding, and long-term support will be invaluable in accelerating the growth of prePO.”



The protocol consists of three key actors, each with their own set of responsibilities including traders, liquidity providers and &#8220;pregens&#8221; — those that vote on changes to the protocol via DOA proposals.



By using prePO, retail investors would gain access to opportunities that venture capitalists, institutional investors, and private equity firms have &#8220;enjoyed exclusively for decades,&#8221; the protocol said in its release.



Investors will also be able to use the platform to hedge their exposure to pre-public assets in their portfolio, or for transparent and up-to-date market pricing, the protocol added.



“prePO&#8217;s breakthrough design ensures that adequate liquidity exists for speculation and that liquidity providers are risk-limited and rewarded meaningfully,&#8221; Ray Xiao, principal at IOSG Ventures, said.



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Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. <a href="https://blockworks.co/newsletter/onthemargin">Subscribe to the Forward Guidance newsletter</a>.



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