Original Title: Taking Stock of Crypto Exchanges Pursuing an IPO
Original Authors: Tanay Ved, Victor Ramirez, Coin Metrics
Original Translation: AididiaoJP, Foresight News
Key Points:
· With a favorable regulatory environment and clear investor interest in public market exposure to crypto assets, Kraken, Gemini, and Bullish are planning to pursue an initial public offering (IPO).
· Coinbase's IPO in 2021 set a benchmark for the industry. At the time of its listing, Coinbase was valued at $65 billion, with 96% of its revenue coming from trading fees, while subscription and service revenue accounted for 44% by the second quarter of 2025.
· Among the IPO candidate trading platforms, Coinbase still leads with 49% of spot trading volume. Bullish and Kraken each account for 22% and are rapidly expanding new services.
· Not all reported trading volumes hold equal value. Analysis of round-trip trading reveals inflated activity on some platforms and underscores the need to assess the quality and transparency of trading platforms.
Introduction
Throughout the history of the cryptocurrency industry, the U.S. government's attitude has often been lukewarm, if not hostile. However, last week saw a positive shift.
The President's Working Group on Digital Assets released a 166-page report outlining the current state of digital assets and proposing policy recommendations for establishing a comprehensive market structure. Meanwhile, SEC Chairman Gary Gensler announced the "Crypto Projects" initiative in a public speech, aiming to make the U.S. the "global crypto capital" by bringing financial markets on-chain, simplifying the cumbersome licensing regime for cryptocurrency businesses, and supporting the creation of financial "super apps" that offer a variety of services.
The primary beneficiaries of this new regulatory framework are centralized trading platforms. Several private centralized trading platforms, such as Kraken, Bullish, and Gemini, are seeking to capitalize on this relatively favorable environment to pursue an IPO. As these companies open up to public investment, it is essential for investors to understand their fundamental drivers. In this article, we will delve into the key metrics of these trading platforms and highlight some considerations when using reported data from trading platforms.
The IPO Boom of Cryptocurrency Trading Platforms
Since Coinbase's IPO in April 2021, there have been very few IPOs related to the crypto industry over the past four years, primarily due to the adversarial relationship between cryptocurrency companies and the former SEC. As a result, private companies have been unable to gain liquidity from the public market, and non-accredited investors have not been able to profit from investing in these companies. With the Trump administration's commitment to introducing a more favorable regulatory regime, a new wave of private cryptocurrency companies has announced plans to go public.
This environment, combined with renewed investor interest in public market exposure to crypto, has given rise to some of the most explosive IPOs, such as Circle's recent public IPO. Gemini, Bullish, and Kraken plan to list in the U.S., hoping to seize this opportunity to position themselves as full-stack service providers for digital assets.
Coinbase's 2021 IPO
Coinbase's IPO in 2021 provides a useful benchmark for assessing the investment prospects of potential trading platform IPOs. The company went public on April 14, 2021, through a direct listing on Nasdaq, with a reference price of $250 per share and a fully diluted valuation of $65 billion, opening at $381. Coinbase's listing coincided with the peak of the 2021 bull market, when Bitcoin prices were nearing $64,000, and trading platform volumes exceeded $10 billion.
According to its S-1 filing, Coinbase's business model at the time was straightforward, with most revenue coming from trading fees:
"From our inception until December 31, 2020, we generated over $3.4 billion in total revenue, primarily from retail and institutional users based on trading volume on our platform. As of December 31, 2020, trading revenue accounted for over 96% of our net revenue. We leverage the advantages of our trading business to expand and broaden our platform, launching new products and services through an investment flywheel and expanding our ecosystem."
Source: Coin Metrics Market Data Pro and Google Finance
Today, Coinbase resembles a "full-stack trading platform." While trading remains its core business, its business model has significantly expanded into the full-stack realm of cryptocurrency services. This change is beginning to reflect in the relationship between COIN price and trading volume, which were closely correlated in the early days, but as the importance of "subscription and service revenue" (including stablecoin income (USDC interest income), blockchain rewards (staking), custody income, etc.) has increased, this correlation has weakened:
Coinbase Q1 2021:
· Revenue: $1.6 billion
· Trading Revenue: $1.55 billion (96%)
· Subscription and Service Revenue: $56 million (4%)
Coinbase Q2 2025:
· Revenue: $1.5 billion
· Trading Revenue: $764 million (51%)
· Subscription and Service Revenue: $656 million (44%)
· Enterprise Interest Income: $77 million (5%)
Comparative Analysis of Upcoming IPO Trading Platforms
Based on this framework, we have listed estimated data on the valuations, trading volumes, and business areas of trading platforms that are set to go public.
Source: Coin Metrics Market Data Pro and public company filings (data as of August 1, 2025)
Although the services offered by these trading platforms tend to be similar, there are significant differences in market influence and the scale of trading activity.
Kraken, founded in 2013, has reached a more mature stage. The company has shown strong financial growth, with projected revenue of $1.5 billion in 2024 (a 128% increase from 2023) and $412 million in revenue for Q2 2025. Kraken is also strategically expanding into areas such as tokenized stocks, payments, and on-chain infrastructure (Ink) through the acquisition of NinjaTrader and obtaining European MiCA licensing. Its target valuation is approximately $15 billion, with 2024 revenue of $1.5 billion, resulting in a revenue multiple of 10 times, slightly lower than Coinbase's 12.7 times.
In contrast, Gemini is smaller in scale. Its average trading volume over the past year was $164 million, the lowest among these trading platforms. Gemini's latest valuation dates back to its Series A funding in 2021 at $7.1 billion, with private market estimates placing it at $8 billion. In addition to spot and derivatives trading, Gemini also offers staking and credit card products, providing yield on user deposits, and is the issuer of the Gemini Dollar (GUSD), although its circulating supply has dropped to $54 million.
Bullish ranks high in trading activity, with an average trading volume of $1.95 billion over the past year. Bullish Exchange is at the core of its trading and liquidity infrastructure, focusing on institutional clients and regulated in Germany, Hong Kong, and Gibraltar, while actively seeking U.S. licensing. Additionally, Bullish has expanded into information services through the acquisition of CoinDesk. According to its F-1 filing, the company reported a net profit of $80 million in 2024, with a net loss of $349 million. Based on a canceled SPAC deal in 2022, its initial valuation was close to $9 billion, and it is currently reported to be seeking a valuation of $4.2 billion.
Trading Platform Volume Trends
Source: Coin Metrics Market Data Pro
Overall, Coinbase and other upcoming IPO trading platforms account for only about 11.6% of the reported spot trading volume of centralized trading platforms. Binance alone accounts for 39%, while other offshore trading platforms also hold significant shares. Among the trading platforms of interest, Coinbase accounts for 49% of spot trading volume, while Bullish and Kraken each account for 22%. Since its launch in 2022, Bullish's share has steadily increased, while Kraken's market share has slightly decreased amid intensifying competition.
Trading on the Order Book: Analyzing Economic Activity of Trading Platforms
As mentioned above, trading volume is one of the most predictive indicators for estimating valuations. However, reported trading volumes may vary by trading platform, becoming a potentially misleading data point.
While most major cryptocurrency trading platforms have cracked down on wash trading, some irregularities still exist. Our Trusted Trading Platform Framework approach details how to detect anomalous trading activity and assesses qualitative factors such as regulatory compliance.
Source: Trusted Trading Platform Framework
A more robust signal we developed for detecting wash trading is calculating the frequency of repeat trades. Our testing methodology is as follows:
· We randomly sampled 144 five-minute periods from January to June 2025, resulting in nearly 20 million trades.
· For each trading platform and period, one trade was selected.
· If another trade occurred within 10 trades or 5 seconds, with the opposite direction, and nearly the same amount and price (1%), these two trades were marked as repeat trades.
· This process was repeated for each trade. If a trade was already marked as a repeat trade, it was skipped.
· The volume marked as repeat trades was calculated and divided by the total volume.
In the figure below, we plotted a sample of trades from a few trading platforms over a period and marked suspected round-trip trades. Each gray dot represents a normal trade, while the green and red markers represent round-trip trades.
Source: Trusted Trading Platform Framework
Due to the approximations of this method, we expect some false positives, which are repeat trades caused by normal market activities (such as market makers facilitating trades by providing liquidity on both sides of the order book). However, compared to industry baselines like Crypto.com and Poloniex, the higher proportion of repeat trades raises concerns about the reliability of their reported trading volume data.
For example: from Q1 to Q2 2025, we estimated that Crypto.com’s trading volumes for BTC-USD ($201 billion), BTC-USDT ($192 billion), ETH-USD ($165 billion), and ETH-USDT ($160 billion) amounted to approximately $720 billion. Based on the estimated proportions mentioned above, about $160 billion of the trading volume in these pairs came from repeat trades.
Conclusion
As several cryptocurrency trading platforms are set to go public, it is essential for investors to understand the relative trading volumes of these platforms. While trading volume helps estimate trading revenue (which still constitutes the majority of revenue), qualitative factors such as business diversification, the presence of repeat trades, and regulatory compliance are also important considerations in assessing the quality of trading platforms. This information can assist market participants in determining whether valuations are reasonable.
Four years after its IPO, Coinbase remains in the lead, primarily due to its diversification in revenue sources such as custody, stablecoins, and Layer-2 fees. However, competition in the trading platform market is intensifying. Other trading platforms must diversify their revenue sources away from heavily market sentiment-dependent trading-related fees to compete. As the market structure becomes clearer, trading platforms are allowed to evolve from trading venues into comprehensive super apps. How these trading platforms seize this opportunity and whether they can realize their vision and replicate the success of past groundbreaking IPOs will be significant developments to watch in the coming year.
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