Kraken in Talks for New Financing Round

Cryptocurrency exchange Kraken is in advanced discussions with a strategic investor to secure a new financing round valued at approximately $20 billion. The company is accelerating its capital raising initiatives ahead of a potential IPO.

People familiar with the situation indicate that the funding round has not yet been finalized and may be subject to change based on market conditions. The expected investment is between $200 million and $300 million. This effort follows Kraken’s recent $500 million fundraising round at a $15 billion valuation, highlighting the significant valuation increases for leading cryptocurrency firms in private markets.

Founded in 2011 and officially operating as Payward Inc., Kraken previously raised only $27 million in seed capital prior to this year. The new financial backing will allow Kraken to enhance its competitive edge against publicly traded competitors like Coinbase and other global exchanges. Recently, the company also began offering tokenized stocks and exchange-traded funds (ETFs).

Key players in the crypto sector are rapidly ramping up their capital-raising activities amid a softening regulatory environment and heightened institutional adoption in the US. Many digital asset companies are utilizing both private and public markets to broaden their product offerings and seek licenses, with some aiming to launch IPOs.

Kraken has reportedly started collaborating with Morgan Stanley and Goldman Sachs on its upcoming IPO, which could potentially occur in the first quarter of next year.

In related news, Tether, another key industry player, is in discussions with investors, including ARK Investment Management, to raise between $15 billion and $20 billion, which may elevate Tether’s valuation to $500 billion. Other companies such as Circle, Gemini, and Bullish have also made public offerings this year.

This is not investment advice.