Fintech
Fintech Fold Plans to Go Public, Lists Bitcoin on Books
Key points
- Fold will go public through a merger with FTAC Emerald Acquisition Corp., in a transaction expected to close in the fourth quarter of this year.
- The financial services company allows users to easily move in and out of Bitcoin, while also earning Bitcoin-denominated cashback rewards for regular spending habits.
- Fold can be seen as a competitor to Block’s Cash App, with an even greater focus on bitcoin.
Bitcoin-focused financial services provider Fold plans to go public via a merger with a special purpose acquisition company (SPAC), FTAC Emerald Acquisition Corp. (EMLD).
Fold offers a debit card with cashback and allows you to buy and sell Bitcoin directly from Fold accounts, among other services. It could be considered a small competitor to Block (square) Cash application product, which also facilitates the buying and selling of bitcoin and has previously enabled reimbursement rewards denominated in cryptocurrency.
The merger, expected to close in the fourth quarter of 2024 subject to regulatory approvals, values Fold at $365 million and will lead to its shares being listed on the Nasdaq.
Fold’s Bitcoin Treasury Could Be an Asset
Fold also has another advantage: it will own bitcoin (BTC).
“Fold is expected to have more than 1,000 BTC on its consolidated balance after the transaction. balance. Fold plans to use the proceeds to accelerate the growth of Fold’s operations and treasury,” the company said in a statement Wednesday. At Wednesday’s bitcoin prices of nearly $66,000, that stake would be valued at about $66 million.
Once listed, Fold will join a list of historic public companies with Bitcoin in their books. MicroStrategy (MSTR) is the most notable, with a holding of 214,400 bitcoin as of April 26, which at current prices (assuming no changes in holding size) would be valued at around $14 billion. Block also held 8,038 bitcoin as of March 31 (currently valued at more than $530 million) on its balance sheet.
Surrounding optimism bitcoin spot exchange traded funds (ETFs) and the bitcoin halving earlier this year and, more recently, the U.S. presidential election, have pushed bitcoin prices higher this year, and that has translated into stock gains for some of the companies that own it. For example, bitcoin is up about 49% year-to-date, and MicroStrategy shares are up nearly 165% over the same period.