BitGo's IPO: A Strategic Play in Maturing Crypto Infrastructure

The maturation of the crypto ecosystem has ushered in a new era of institutional adoption, with infrastructure providers like BitGo emerging as pivotal players. As the first crypto custodian to file for a U.S. IPO in 2025, BitGo's public offering represents not just a milestone for the company but a broader validation of digital asset infrastructure as a critical component of the global financial system. This analysis evaluates BitGo's dual-class share structure, revenue growth, and regulatory advancements to assess its potential as a long-term value creator in a rapidly evolving market.

Dual-Class Governance: Control and Controversy

BitGo's IPO filing reveals a dual-class share structure designed to preserve concentrated control. Class A shares carry one vote per share, while Class B shares-held predominantly by CEO Michael Belshe-carry 15 votes each. This arrangement grants Belshe 55.5% of the voting power despite owning only 7.7% of the economic ownership, a structure that classifies BitGo as a "controlled company" under NYSE rules. Such governance models are common in tech and crypto startups, enabling founders to maintain strategic autonomy amid public market pressures. However, critics argue that concentrated voting rights may prioritize long-term vision over short-term shareholder interests, particularly in volatile markets.

For institutional investors, this structure presents a double-edged sword. On one hand, it ensures continuity in BitGo's execution of its mission to build secure, compliant crypto infrastructure. On the other, it limits shareholder influence over key decisions, a risk that must be weighed against the company's track record of regulatory alignment and operational scalability.

Revenue Growth and Market Position

BitGo's financial performance in the first half of 2025 underscores its dominance in the crypto custody sector. The company reported $4.19 billion in revenue, a near fourfold increase year-over-year, with assets under custody surging to $90.3 billion as of June 30. This growth is driven by a surge in institutional demand for secure custody solutions, as evidenced by the firm's 4,621 clients managing $90.3 billion in assets.

However, profitability remains a concern. Net income fell to $12.6 million in H1 2025 from $30.9 million in the same period in 2024, reflecting rising operational costs tied to regulatory compliance and infrastructure expansion. While this margin compression is not uncommon in high-growth sectors, it highlights the need for BitGo to balance aggressive scaling with cost discipline. The company's ability to leverage its regulatory licenses-such as its U.S. bank charter-to diversify into higher-margin services like staking and trading could mitigate this challenge.

Regulatory Tailwinds and Institutional Adoption

BitGo's regulatory progress in 2025 has been nothing short of transformative. The firm secured MiCA-compliant licenses in Germany and Dubai, positioning itself as a global custodian capable of serving European and Middle Eastern markets. More significantly, it obtained a national bank charter from the U.S. Office of the Comptroller of the Currency (OCC), enabling the formation of BitGo Bank & Trust, National Association. This achievement places the company on par with traditional banks, enhancing its credibility among institutional clients wary of regulatory uncertainty.

Institutional adoption has also been bolstered by broader regulatory clarity, including the repeal of SAB 121 and the implementation of the EU's MiCA framework. BitGo's partnership with TaxBit to enhance IRS 1099-DA reporting further aligns it with U.S. tax compliance requirements, addressing a key barrier for institutional investors. These developments position BitGo as a bridge between the crypto ecosystem and traditional finance, a role that could drive recurring revenue and market share expansion.

Long-Term Value Creation: Catalysts and Risks

The convergence of BitGo's governance model, growth metrics, and regulatory progress creates a compelling case for long-term value creation. Its dual-class structure ensures founder control during a critical scaling phase, while its $90.3 billion in assets under custody reflects a defensible market position. Regulatory tailwinds, including the U.S. bank charter, open avenues for cross-selling services to institutional clients, potentially transforming BitGo from a custody provider into a full-service crypto infrastructure platform.

However, risks persist. The decline in net income underscores the need for operational efficiency, and the concentrated voting power of Class B shares may deter risk-averse investors. Additionally, the crypto market's inherent volatility could impact demand for custody services if institutional adoption slows.

Conclusion

BitGo's IPO represents a strategic inflection point for the crypto infrastructure sector. By leveraging its dual-class governance to maintain long-term focus, scaling its custody business amid favorable regulatory trends, and expanding into adjacent services like staking and stablecoin infrastructure, the company is well-positioned to capitalize on the institutionalization of digital assets. For investors, the key will be monitoring how effectively BitGo balances growth with profitability while navigating the evolving regulatory landscape.