Japanese Crypto Exchange Coincheck Eyes U.S. Listing Via $1.25 Billion SPAC Deal

Coincheck, a Tokyo-based cryptocurrency exchange, announced on Tuesday it had agreed to go public in the U.S. by merging with special purpose acquisition company Thunder Bridge Capital Partners in a deal valued at about $1.25 billion.

Coincheck, a subsidiary of Japanese online brokerage firm Monex Group, is expected to list on the Nasdaq Global Select Market when the transaction is closed in the second half of 2022, according to a statement. The combined entity will receive $237 million in cash held in Thunder Bridge Capital Partners’ trust, assuming there are no shareholder redemptions and before expenses.

The transaction will allow Coincheck to expand its business in Japan and overseas, the crypto marketplace said. The business combination will also allow the firm to increase product offerings and continue its investments in security and infrastructure.

Founded in 2012, Coincheck markets itself as one of Japan’s largest multi-cryptocurrency marketplaces and digital asset exchange. The company said it serves about 1.5 million verified customers, which accounts for 28% of Japan’s 5.5 million cryptocurrency owners. The exchange handled about $100 million worth of spot trades of digital assets in the past 24 hours as of Wednesday, according to tracker CoinGecko.

Coincheck fell victim to one of the biggest crypto hacks in history when the firm reported that about $500 million worth of digital coins were stolen from its platform in early 2018. Later the same year, Coincheck was acquired for about $34 million by Monex Group, which at the time revealed plans for an initial public offering for the crypto platform.

Monex will own about 82% of the combined entity after the merger, down from its current ownership of 94.2%, according to the statement. Meanwhile, existing Coincheck shareholders are eligible to receive a maximum of 50 million shares based on the future performance of its stock.

Coincheck’s SPAC deal comes as Japan is looking to speed up the lengthy screening process for cryptocurrency listings on the country’s trading platforms as part of its bid to keep up with the global crypto industry. The Japan Virtual and Crypto Asset Exchange Association, an industry body that consists of 31 exchanges, said on Tuesday that it plans to exclude at least 18 crypto tokens from the approval process, according to Nikkei Asia. Among the candidates are popular digital assets bitcoin, ether, XRP and litecoin, the report said.