Kraken Update: eToro IPO Implications – InvestX Reaction
Circle Internet Group, the issuer of the popular USDC stablecoin, recently made a highly anticipated debut on the New York Stock Exchange under the ticker “CRCL” on June 5, 2025. The company initially priced its upsized initial public offering at $31.00 per share, which was above its previously marketed range of $27.00 to $28.00, reflecting strong investor demand. This strong interest was evident in its immediate trading activity, with the stock opening at $69.00 and soaring as much as 168% on its first day of trading, closing at $83.23. The positive momentum has largely continued, with CRCL shares surging to over $180 per share in the days following the IPO, indicating significant enthusiasm for stablecoin issuers amidst increasing regulatory clarity and growing institutional adoption of digital assets.
This renewed interest in crypto and the more permissive regulatory environment was also evident with the IPO of eToro on May 14, 2025. We believe that eToro represents a more direct comparable to our investment in Kraken.
eToro’s upsized U.S. IPO raised approximately $620 million at $52 per share—above its initial $46–$50 range and the $40-45 per share price on the secondary market last year (Caplight)—and delivered a 34% first-day pop to a $5.64 billion market capitalization. This performance underscores strong investor demand for trading fintechs and high-growth crypto revenue streams—eToro’s crypto trading volume nearly quadrupled to $12.15 billion 2024 (up from ~$3.43 billion in 2023). It signals a selective reopening of IPO markets for top-tier fintech platforms and we believe it primes the stage for Kraken’s anticipated late-2025 IPO, as the exchange has begun informal fundraising discussions and organizational restructuring in preparation. Kraken’s crypto-native business model, institutional-grade infrastructure, and regulatory foothold—having become the first crypto company to obtain a U.S. bank charter—position it to capitalize on normalized valuations and in our opinion, potentially outperform as investor appetite for digital-asset platforms intensifies. Broader sector momentum is evidenced by Klarna’s recent U.S. IPO filing to raise over $1 billion at a potential $15 billion valuation, and Stripe’s tender offer climbing to $91.5 billion amid improved venture-capital conditions—all underpinned by easing Fed policy and a temporary tariff détente that have lifted risk sentiment.
eToro’s IPO Debut
Offering Size and Pricing
Israel-based trading platform eToro upsized its IPO to raise about $620 million by selling 11.92 million shares at $52 each—topping its initial $46–$50 range. The offering was led by Goldman Sachs, Jefferies, UBS, and Citigroup, and marked the first major U.S. fintech IPO since 2021’s Riskified listing.
Early Trading Performance
On its Nasdaq Global Select debut under the ticker “ETOR”, eToro shares opened at $69.69—34% above the IPO price—lifting its market cap to $5.64 billion. The trading price has since stabilized in the $60 per share range, as of June 2025. This made it the largest U.S. exchange offering by an Israeli fintech since Riskified, and reignited confidence in public listings after earlier market delays.
Valuation Multiple
Comparing eToro’s $5.64 billion opening valuation to its 2024 revenue (notably $931 million in total trading commissions/ 6.1x 2024 net sales multiple) suggests investors are applying premium multiples to platforms with scalable, diversified revenue streams and demonstrable profitability.
Comparing eToro and Kraken
Business Model Similarities
- Retail-First Platforms: Both eToro and Kraken cater to retail investors, offering accessible UIs for trading stocks, ETFs, and cryptocurrencies.
- Community and User Engagement: eToro features social trading tools allowing users to follow and mimic top traders, while Kraken’s “Kraken Scores” and educational content aim to build community trust.
- Diversified Asset Access: Each platform provides a multi-asset mix—eToro spans stocks, crypto, and commodities, whereas Kraken offers over 290 cryptocurrencies and fiat pairs.
Strategic Differences
- Crypto-Native Focus: Kraken is purpose-built for digital assets, with institutional services (Kraken Institutional) and custody offerings, whereas eToro evolved from social equity trading into crypto over time, with cryptocurrency trading commissions representing approximately 38% of its total commission revenues in 2024. That said, Kraken plans to offer tokenized equities trading as part of its product suite to provide additional revenue streams, contingent on further regulatory clarity around the tokenization of public equities.
- Regulatory Profile: Kraken holds a special purpose depository institution charter in Wyoming and has addressed multiple regulatory actions, positioning itself as a compliance leader; eToro’s U.S. crypto offerings remain limited post-SEC settlement to BTC, BCH, and ETH.
- Geographic Reach: eToro boasts 40 million users in 75 countries, with a strong European and Middle Eastern presence, while Kraken serves over 15 million clients globally in over 190 countries and is expanding into traditional asset trading through acquisitions like NinjaTrader.
How We Believe eToro Sets the Stage for Kraken
- Investor De-Risking: eToro’s strong debut has allayed concerns about profitability and user engagement in retail fintech, validating the “speculation-plus-social” model and reducing perceived execution risk for similar players.
- Normalized Valuations: The 61% re-rate from private-market funding to public valuation (Caplight) establishes benchmarks for price-to-revenue and monetization metrics, guiding Kraken’s potential pricing strategy.
- Crypto Legitimacy: Inclusion of crypto revenue drivers in eToro’s valuation (four-fold crypto growth) reinforces digital asset trading as a core earnings engine, potentially benefiting crypto-native exchanges like Kraken.
- Selective Market Reopening: We believe eToro’s success affirms that IPO windows are open for fintechs with strong unit economics and compliance pedigrees, which in our opinion directly supports Kraken’s planned late-2025 offering.
Assessing Broader Fintech Market Sentiment
Private-to-Public Comps Analysis
Our Q1 2025 fintech private-to-public comps analysis illustrates the premium private fintechs command over public peers has shrunk by roughly 15–20% since late 2023 as crossover-fund participation and secondary-market liquidity increasingly align private valuations with public multiples (PitchBook, Caplight). This convergence is driven by active pre-IPO structuring among leaders like Klarna, Chime and Revolut and suggests that the window for capturing elevated private-market premiums before full arbitrage closes is narrowing. For Kraken—trading at just ~6.9x EV/2024E sales versus an 11.4x public-fintech average—this dynamic implies that a late-2025 IPO could realistically achieve a 10–11x multiple by riding the final wave of private-to-public valuation compression, especially as we head into an easing macroeconomic environment that should benefit fintech multiples as interest rate decreases trickle through the economy (Multiples calculated using PitchBook and Caplight data).
Valuation Gap Analysis
| Company Type | Private Market P/S | Public Market P/S | Premium |
|---|---|---|---|
| Payment Processing (Stripe) | 4.8x | 3.7x | +30% |
| Digital Banking (Revolut) | 8.7x | 3.9x | +123% |
| Neobanking (Chime) | 7.4x | 3.9x | +90% |
| BNPL (Klarna) | 6.0x | 2.2x | +173% |
Klarna’s U.S. IPO Filing
Swedish buy-now-pay-later giant Klarna confidentially filed its U.S. IPO in November 2024, disclosing a 24% revenue surge to $2.81 billion in 2024 and targeting over $1 billion in proceeds at a valuation above $15 billion. Its filing has spurred hopes for a revival of British fintech listings, with other challengers like Monzo and Starling weighing public debuts or M&A opportunities.
Stripe’s Tender-Offer Valuation
Stripe’s February 2025 tender offer priced the company at $91.5 billion—up 41% year-over-year—underscoring strong private-market appetite and highlighting the cloud-payment giant’s profitability trajectory into 2025.
Chime’s Nasdaq Listing Plans
Digital bank Chime filed for a Nasdaq listing in May 2025 [Source: Nasdaq Filing, May 2025], joining eToro as part of a wave of consumer-focused fintechs testing public markets for the first time in years.
Chime, the popular fintech company offering mobile-first banking services, recently made its highly anticipated public debut on the Nasdaq Global Select Market under the ticker CHYM on June 12, 2025. The company priced its initial public offering at $27.00 per share, which was above its previously estimated range of $24.00 to $26.00, raising $864 million. While this valuation of approximately $11.6 billion (fully diluted) represents a significant decrease from its 2021 private valuation of $25 billion (PitchBook), investor enthusiasm was evident in its first day of trading. Chime’s stock opened at $43.00, surging over 59% from its IPO price, and closed its debut day up 37% at $37.11. Although the stock has seen some fluctuations since then, trading in the low $30 range currently (as of June 2025, PitchBook), we believe its strong opening signals a renewed appetite in the market for fintech IPOs.
Macro Trends Driving IPO Reopenings
- Easing Monetary Policy: April’s U.S. CPI rose 2.3% year-over-year—below expectations—prompting markets to price in Federal Reserve rate cuts beginning in late 2025.
- Trade-War Détente: A 90-day U.S.-China tariff pause reduced geopolitical risk, lifting risk-asset sentiment and boosting equity futures ahead of new issuances.
- Liquidity Rotation: Stable economic data and moderated volatility have seen institutional capital rotate back into growth-oriented sectors, with IPO proceeds in 2025 on pace for multi-year highs.
Valuation Benchmarking and Growth Catalysts
To illustrate how Kraken’s IPO could be positioned for upside, we compare its implied EV/2024E net-sales multiple against public fintech peers and its last private-market round. The chart below shows Kraken trading at roughly a 40% discount to the public-company average (i.e., Coinbase, eToro, Robinhood, Interactive Brokers), with clear catalysts in place to drive multiple expansion.
Figure 1 Highlights
- Kraken stands to benefit from a Reopened IPO Window for High-Growth Fintechs: As illustrated above, Kraken’s 6.9x EV/2024 net sales multiple (based on recent secondary transactions at $25.50/share) sits roughly 40% below the 11.4x public fintech comps average and at a 32% discount to its direct competitor Coinbase (which is now part of the S&P 500), highlighting a clear re-rating runway. Bolstered by a 90-day U.S.-China tariff truce, Fed-funds futures signaling rate-cut expectations, and strong performance from eToro’s IPO debut, the macro-regulatory backdrop is primed to sustained renewed fintech listings.
- Fintech IPO Recovery & Pipeline Momentum: eToro’s IPO marked the first major fintech public offering in four years, snapping a 48-month drought in new listings. The stock closed 34% above its $52 offering price on day one, underscoring renewed investor appetite for high-growth fintech names. In addition, the successful debut spurred peer filings, with mobile banking challenger Chime and design-software firm Figma entering the IPO queue shortly thereafter.
- Noteworthy Re-Ratings: Stripe’s recent tender offer valued the payments firm at $91.5 billion—a 41% year-over-year jump, demonstrating how quickly fintech multiples can rebound once liquidity returns. The Swedish BNPL giant Klarna also confidentially filed for a U.S. IPO targeting a pro-forma valuation north of $15 billion, signaling that reopened IPO windows command premium multiples for best-in-class fintechs.
The enthusiasm for the Circle IPO and the recent success of IPOs in eToro and Chime signal increasing potential for a late-2025 potential Kraken IPO as the company stands to benefit from a freshly reopened fintech window—sparked by eToro’s and Chime’s robust debuts—and an almost 40% discount to public comps multiples that point to clear upside. With renewed investor appetite for community-driven platforms, impending SEC clarity around digital asset rules, and strong institutional pre-IPO backing amid easing headwinds, we believe Kraken is well-positioned to capture a multiple re-rating and potentially deliver attractive value.
Definitions
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- IPO – Initial public offering
- UI – User interface
- ETF – Exchange-traded fund
- EV – Enterprise value
- CPI – Consumer price index
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