This Crypto Company Plans To Go Public Amid Bear Market
CoinGape Staff - CoinGape
If sources are to be believed, cryptocurrency ATM firm Bitcoin Depot has struck a deal with a special-purpose acquisition company (SPAC) to go public.
In a deal that values the company at nearly $885 million, Bitcoin Depot will likely combine with the SPAC GSR II Meteora Acquisition Corp. The deal is expected to be unveiled later today. There are speculations that the company will pursue acquisitions post its IPO.
Bitcoin Depot is an Atlanta-based one of the fastest-growing crypto ATM companies in the world. The company operates more than 7,000 Crypto ATMs in the US and Canada. Unlike conventional automated teller machines, Bitcoin Depots are kiosks where cash can be used to buy bitcoin or any other digital currency, usually by scanning a QR code. Since consumers are not required to link their bank account or credit cards with their digital wallet, bitcoin ATMs facilitate greater accessibility of people to cryptocurrencies.
Globally there are approximately 40,000 bitcoin ATMs, with the majority of them in the US. It is noteworthy that Bitcoin Depot claims it has continued to grow even when there is a market downturn and the crypto market is following a bearish trading pattern.
In the second quarter, the company posted record sales and EBITDA driven by a growing number of users. Recently, Bitcoin Depot grabbed attention after launching a product that allows customers to use cash at more than 8,000 stores to purchase cryptocurrency through the company’s mobile app sans physical kiosks.
Concerns Related With Bitcoin ATMs?
Certain concerns have been related to using Bitcoin ATMs as they increase the risk of money laundering, scams, and other frauds. Earlier this year, Singapore, known to support the crypto industry, decided to ban bitcoin ATMs in view of the safety issues. The current challenges in the business environment due to rising interest rates and inflation has hit hard even the SPACs and thus a concern for investors.
Mergers through SPACs have become quite common these days compared to the traditional method of initial public offerings (IPO) adopted earlier.
What Is SPAC?
Popularly known as a blank-check company, a SPAC is a firm that is listed on a stock exchange and raises capital from investors via an IPO to acquire or merge with an existing company. Once the deal is completed, the company which is going public replaces the SPAC in the stock market. In the past, various cryptocurrency companies have also gone public via SPACs; these include Bakkt Holdings Inc. and Cipher Mining Technologies Inc.
It remains to be seen if the GSR II Meteora SPAC investors pull their money from the total of $320 million before this merger is done or show support for this decision without pulling out their investment.
View full text