Crypto trading marketplace eToro to go public through $10.4 billion SPAC deal backed by SoftBank, others
Back in 2018, we wrote about eToro (formerly called RetailFx) after the blockchain startup pledged a $1 million fund to support a research initiative on humanitarian blockchain to reduce wealth inequality and it is recruiting partners. eToro, a social trading and investment marketplace that allows users to trade popular cryptocurrencies, commodities, indices, and stocks.
Today, eToro announced it will go public through a merger with a blank-check firm backed by FinTech Acquisition Corp V in a $10.4 billion deal, with investment from SoftBank’s Vision Fund 2. As we previously reported, SoftBank joined the SPAC craze in December 2020 after it launched its blank-check company.
Sometimes called a special purpose acquisition company (SPAC), a blank-check company is a shell company that has no operations but plans to go public with the intention of acquiring or merging with a company utilizing the proceeds of the SPAC’s initial public offering (IPO).
The deal with FinTech Acquisition Corp V, a fintech company led by banking entrepreneur Betsy Cohen, will include a $650 investment from investors including Fidelity Management & Research Co LLC and Wellington Management.
EToro joins a wave of Israeli tech companies and startups including mobile gaming company Playtika Holding Corp, that are going public in the U.S. to take advantage of the capital markets boom.
According to the company’s website, bitcoin accounts for one of every 25 positions opened on eToro, while the most popular stocks are Tesla Inc, Microsoft Corp, and Apple Inc. In 2020, eToro added over 5 million new registered users and generated gross revenue of $605 million, a 147% jump from a year earlier.
Founded in 2007 by brothers Yoni Assia and Ronen Assia together with David Ring, eToro has 20 million registered users who can manually invest in cryptocurrencies, stocks, commodities, and more, while those who lack time or experience can automatically copy the trades of others on the platform. eToro currently boasts over 20 million traders on its platform.