Crypto IPOs Surge 100% Year-Over-Year as GENIUS Act Nears Passage

JPMorgan has highlighted a positive shift in the U.S. regulatory environment, which is fostering increased corporate activity in the cryptocurrency sector. The investment bank noted that the number of crypto IPOs this year has matched the pace seen during the bull market of 2021. This surge in IPO activity is attributed to the anticipated passage of the GENIUS Act in the Senate, which aims to establish federal regulation for stablecoins with a market cap exceeding $10 billion. The act also allows for state regulation if it aligns with federal rules.

Stablecoins, which are cryptocurrencies pegged to the value of another asset like the U.S. dollar or gold, play a crucial role in cryptocurrency markets and are widely used for international money transfers. The anticipated regulatory clarity provided by the GENIUS Act is expected to encourage more crypto companies to go public and attract increased venture capital funding. According to JPMorgan, venture capital funding has already surpassed levels seen in 2023/24 on an annualized basis.

Several crypto companies, including Ripple, Kraken, Consenys, and CoinDesk's owner Bullish, are reportedly preparing for IPOs this year. These IPOs offer crypto investors an opportunity to diversify their digital asset exposure beyond the two largest cryptocurrencies by market cap, bitcoin and ether. By investing in crypto IPOs, investors can gain exposure to various areas within the crypto ecosystem, such as blockchain infrastructure, payments and settlement, custody, and tokenization.