Thiel-Backed Crypto Exchange Merges With SPAC Run By Former NYSE President

Thiel-Backed Crypto Exchange Merges With SPAC Run By Former NYSE President

A few months ago, we reported on a new type of hybrid crypto exchange which combined attributes of the Decentralized Exchanges (otherwise known as a “DEX”) that have exploded in popularity this year.

The firm, known as “Bullish Global”, is now going public by merging with a SPAC run by a former chairman of the New York Stock Exchange, in the latest example of how Wall Street stalwarts continue to embrace “opportunities” in the crypto space. According to CNBC, “[c]rypto startup Bullish plans to go public in a reverse merger with the special purpose acquisition company backed by Tom Farley, the former New York Stock Exchange president.”

Farley’s SPAC, the Far Peak Acquisition Corporation,saw its shares jump roughly 4% on the news in premarket trading.

Bullish expects to receive around $600MM in proceeds from Far Peak, leaving the combined company with an implied pro forma valuation of $9 billion.

Bullish has gained a lot of profile in part thanks to its coterie of big-name backers.

The merger implies a pro forma equity valuation of roughly $9 billion.

The deal will make Bullish the second crypto exchange with a public listing in the US. Coinbase, the global leader in the crypto exchange space, went public in April and has struggled to convince investors of its valuation. One problem: the space is seen as hyper-competitive, and one reason is because there are so many players in a market that’s rapidly evolving. The move toward decentralized exchanges, and cryptocurrencies that support those exchanges, has been a big deal over the past year.

For those who aren’t familiar with how a DEX works, Decrypt explains that decentralized crypto exchanges don’t ask American citizens to enter private information, such as social security numbers or addresses, that centralized exchanges are compelled to require as part of the Bank Secrecy Act. Thus far, because DEXs don’t take control of assets, they’ve fallen outside such regulations.

Since your coins aren’t being held in a centralized exchange but in a wallet with private keys you hold, you’re immune to hacks. And even though centralized exchanges can go down for maintenance, on a DEX you can keep trading.

Decentralized exchanges generally try to embrace blockchain’s ethos of “trustlessness” and privacy. Your tokens remain in your possession until you trade them. Some people find that reassuring from a security perspective. For others, that level of responsibility is intimidating, and the risks are concerning.

DEX advocates mostly agree: those are the tradeoffs for true decentralization.

The deal will include a $300MM PIPE (Private Investment in Public Equity) financed by a handful of notable investors, including BlackRock and Mike Novogratz’s Galaxy Digital. Other investors in Bullish include Alan Howard, Peter Thiel, Louis Bacon, Richard Li, Mike Novogratz, Christian Angermayer and Nomura.

Tyler Durden
Fri, 07/09/2021 – 09:21

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