A recent report reveals that digital trading platform eToro is gearing up to roll out an initial public offering (IPO) of $5 billion on the NASDAQ stock exchange. The report also revealed that Goldman Sachs could be chosen to manage the IPO when it goes live.
However, eToro refuted the claims, calling it a market rumor. “eToro does not comment on market rumors,” a spokesperson for the company said.
IPO may begin in Q2 2021
eToro is a trading enabler in a wide range of funds and assets, including commodities, FX, listed shares, and digital assets.
The Israel-based platform may be starting the IPO in the second quarter of next year. It has also considered going public through a Special Purpose Acquisition Company.
The process is very common with companies who want to list their shares on a public exchange. eToro’s present valuation may have crossed $2.5 billion after gaining new customers this year. Like other similar platforms, the COVID-19 pandemic boosted eToro’s customer base leading to a 5 million gain this year.
Booming brokerage business
eToro is launching its IPO at a period when demand for the company’s products and services is increasing. The pandemic has resulted in higher retail demand and the company now has more than 15 million trades on-board.
eToro was established in 2017 and became very popular as a social trading platform. It provided an option for users to make them more effective when choosing trading strategies. eToro allowed traders to copy the trading styles and strategies of experts – a feature on the platform that’s now widely used by new traders.
The company has been busy with expansion activities lately. It has invested heavily over the recent years to expand its product line and offers virtually all types of assets, including cryptocurrencies.
A giant in the digital trading industry
eToro started with $1.7 million seed money, then raised $162 million after closing five funding rounds. The last funding round was two years ago. The company raised $100 million only from that funding round with a valuation of $800 million.
Notwithstanding, the market valuation of the brokerage rose considerably recently, with news circulating that $50 million worth of eToro shares valued at $2.5 billion was recently bought by a US-based institutional investor.
The massive investment has skyrocketed the firm’s status to become a top player among the major digital trading platforms.
In a related development, Robinhood, the US-based stock brokerage disrupter, wants to go public next year with a $20 billion valuation.