Major Cryptocurrency Exchange Bithumb Considers Going Public in the United States via Reverse Merger
According to reports on January 22nd, one of the world’s largest cryptocurrency exchanges, Bithumb, is seeking to acquire an American publicly traded company for a reverse merger. As per CNBC, Bithumb stated it has a binding letter-of-intent with Blockchain Exchange Alliance, a blockchain holding company based in the United States. After the merger, the Singapore-based company, BTHMB HOLDINGS Pte. Ltd, is expected to change its name to Blockchain Exchange Alliance (BXA).
Simply put, a reverse merger allows a company looking to go public on the capital markets to do so by merging with a pre-existing public company. During a reverse merger, the pre-existing public company’s ticker symbol and corporate name are typically changed to reflect the amalgamation of the two companies. Reverse mergers generally provide a more cost-effective and less time-consuming means of going public in the United States versus a traditional initial public offering (IPO).
This important merger could pave the way for a more regulated platform on which to exchange digital currencies. It could also solve potential liquidity issues by opening up the doors to United States-based institutional investors.
Wednesday, January 23, 2019