New York-based Bitcoin rewards application Fold is making strides towards a public listing on the Nasdaq stock exchange through a merger with special-purpose acquisition company Emerald Acquisition Corp. (EMLD). The innovative company offers a cashback debit card that awards users with Bitcoin instead of traditional cash rewards. The decision for a merger comes as Fold's cards have seen over $2 billion in transactions and have doled out in excess of $45 million in Bitcoin rewards, based on information from a recent announcement on Wednesday.

The merger has been unanimously approved by the boards of both participating entities, with a pre-transaction valuation set at $365 million. Upon completion, the post-transaction enterprise will have a substantial sum of over 1,000 BTC, equivalent to around $67 million, on its balance sheet. However, details regarding the expected closing date of the merger and the new ticker symbol under which Fold will trade on the Nasdaq remain undisclosed.

The move to go public marks a significant step in the Bitcoin industry, which saw a decline in SPAC activity during the 2022 'crypto winter.' With several SPAC deals being cancelled amid market downturns, it is yet to be seen if this venture will spark a resurgence of similar transactions. Notably, Bitcoin financial services firm Swan retracted its SPAC plans earlier this week, also downsizing its workforce amid a broader reorganization.

Fold's CEO, Will Reeves, emphasizes that the transaction is a "significant step" in their mission to make Bitcoin financial services accessible to all. He adds, "Fold aims to make bitcoin available to everyone—through accessible, engaging, and useful bitcoin products that are tailored to meet the needs of spenders, earners, and savers."

The deal values Fold at a pre-money equity valuation of $365 million and expects the merged entity to benefit from the growth of Fold's operations and treasury. Existing Fold stockholders will be subject to a six-month lock-up period, which could be lifted earlier if the stock price surpasses $12.00 per share for 20 days within a 30-day period, 90 days following the closing.

The anticipated closure of the transaction is set for the fourth quarter of 2024, pending regulatory and stockholder approvals, and the SEC's nod on a registration statement on Form S-4. Post-transaction, Fold's leadership, helmed by Reeves, will carry on managing the company.

The merger will lead to a restructuring of the combined company's Board of Directors, which will include Fold Director Reeves, Brace Young, and FTAC Emerald Director Andrew Hohns, as well as Jonathan Kirkwood of Ten31.

As Fold positions itself for a future on the public markets, the potential implications are vast, signaling a growing integration of Bitcoin-based financial services within mainstream investment platforms. This move may pave the way for broader adoption and recognition of Bitcoin as a viable reward mechanism in everyday financial transactions.

Fold Press Release

CoinDesk Article