Clear Street Eyes $10–12 Billion IPO Amidst Crypto Treasury Challenges

Clear Street's IPO Ambitions

New York-based brokerage Clear Street is gearing up for an initial public offering (IPO) with a projected valuation between $10 billion and $12 billion. Known for its active role in the crypto-treasury sector, Clear Street could go public as soon as next month, with Goldman Sachs leading the offering, according to the Financial Times. However, sources suggest the pricing might not finalize before January.

Founded in 2018, Clear Street gained prominence by supporting companies that adopted the 'crypto treasury' strategy, raising capital to invest in Bitcoin (BTC). This model was notably popularized by Michael Saylor's strategy, amassing 650,000 BTC through various offerings, some underwritten by Clear Street.

Challenges in Crypto Treasury Model

The IPO plans emerge as the crypto-treasury model faces challenges. Bitcoin has dropped about 30% since early October, and firms like Strategy have seen share prices plunge by 60% over six months. Smaller crypto treasury companies now often trade below their token values, limiting their ability to issue new stock for BTC purchases—a key mechanism during bullish times.

Galaxy Research highlights that Bitcoin treasury firms are entering a 'Darwinian phase' as their business model's core mechanics falter. 'The same financial engineering that amplified upside has magnified downside,' Galaxy stated.

Crypto Companies Going Public

This year, approximately 316 companies have been listed in the US, raising about $63 billion, the highest since 2021. Grayscale Investments recently filed an S-1 with the SEC to list its shares on the New York Stock Exchange, joining a wave of crypto firms going public. In September, BitGo filed for a US listing, and Gemini debuted on Nasdaq shortly after submitting its Form S-1 to the SEC.