The merger is intended to create the first publicly traded crypto exchange in the US.
On Tuesday, January 22, Blockchain Industries Inc. announced it had signed a “binding letter of intent” to conduct a reverse merger – also called a reverse IPO – with Singapore crypto company BTHMB HOLDINGS Pte. Ltd. (“BTHMB”) – the holding company for the popular crypto exchange Bithumb.
A reverse merger takes place when investors from a privately owned company purchase the majority of shares in a publicly owned shell company. The reason for the new deal is to streamline the process of getting the private company listed on a US stock exchange.
According to the announcement, the new company will now be called the Blockchain Exchange Alliance (BXA) and may become the first “publicly traded cryptocurrency company.” In addition to getting the exchange listed, the merger is also intended to solve other problems associated with digital currency exchanges, such as liquidity, accessibility, and expansion. The announcement states that the merger unexpectedly resulted in the creation of a “unified, more secure global exchange platform with a broad capability to support emerging blockchain e-commerce, payments, and other digital finance functions.”
Bithumb has already placed $1 million into escrow to jumpstart the deal. However, the merger is still under review and a final decision needs to be made regarding the terms of the deal and the valuation of the company.
The merger is tentatively scheduled to be completed by March 1 of this year.
Bithumb has come under a lot of scrutiny since June of last year, when the exchange was hacked and approximately $31.5 million worth of crypto was stolen. In December, Bithumb was accused by a Ukrainian exchange ranking service of wash trading, the act of buying and selling currencies simultaneously to create artificial trade volume and heighten perceived demand.
Nathan Graham is a full-time staff writer for ETHNews. He lives in Sparks, Nevada, with his wife, Beth, and dog, Kyia. Nathan has a passion for new technology, grant writing, and short stories. He spends his time rafting the American River, playing video games, and writing.
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