eToro Seeks U.S. IPO as Crypto-Friendly Trading Platform Expands Reach

eToro, the prominent retail trading platform that offers both stocks and cryptocurrencies, is preparing to launch an Initial Public Offering (IPO) on the New York Stock Exchange, as reported by the Financial Times. The move could happen as early as the second quarter, with the company targeting a valuation of over $5 billion, according to confidential filings with the U.S. Securities and Exchange Commission (SEC).

Goldman Sachs, Jefferies, and UBS are advising eToro in this endeavor.

Should the offering succeed, eToro will join other crypto-friendly public companies like Coinbase (COIN) and Robinhood (HOOD), though it will be considerably smaller in comparison. Coinbase currently boasts a market cap of $69 billion, while Robinhood stands at $40 billion.

This upcoming valuation is significantly lower than the company’s initial $10.4 billion target in 2021, when it attempted to go public via a SPAC merger, which was later called off due to unfavorable market conditions in late 2022.

In 2023, eToro secured $250 million in funding at a $3.5 billion valuation, supported by investors such as SoftBank. Despite a drop in its valuation, the company’s worth has since climbed, supported by a recovery in cryptocurrency markets. eToro also reached a settlement with the SEC, agreeing to pay $1.5 million to resolve claims of operating as an unregistered broker and clearing agency while facilitating the trading of certain crypto assets as securities.

Although eToro has not disclosed specific cryptocurrency trading volumes, reports from Finance Magnates suggest that its crypto volume surged by more than 500% in the year ending in November 2023.

Founded in Israel in 2007, eToro currently manages $11.3 billion in assets for over 3 million customers. The platform allows trading in a range of assets, including cryptocurrencies, stocks, and exchange-traded funds (ETFs). However, following its settlement with the SEC, eToro has limited U.S. customers to trading only Bitcoin (BTC), Bitcoin Cash (BCH), and Ether (ETH).

eToro has not yet commented on the IPO filing.