Shares of Bitcoin mining company Hut 8 are set to start trading Next Tuesday, October 8, on the Toronto Stock Exchange (TSX). But don’t call it an IPO.
Hut 8, which was conditionally approved to be listed on Canada’s principal stock exchange, is not going public through a traditional route. Instead, the company will float on the Canadian bourse through its “TSX Sandbox,” an initiative that provides an alternative path to the exchange listing for certain qualifying companies.
The direct listing will allow the Canadian crypto firm to avoid a pricey and time-consuming process. While in the program, Hut 8’s common shares will trade in the same manner as other TSX listed companies. The world’s largest public cryptocurrency mining operation will exit the TSX Sandbox program upon the receipt of a prospectus, provided that no major compliance issues occur for a 12-month period.
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QuadrigaCX crisis in mind
For better or for worse, Hut 8 has also disclosed its risk factors, including how volatility will impact investments and how the value of its shares will be based on the value of Bitcoin price.
After QuadrigaCX crisis, the crypto exchange that was shut down following the sudden death of its founder, the Canadian crypto community, has been skeptical about crypto platforms.
The TSX has listed various eligibility criteria it will consider when evaluating Sandbox applications. Once approved by the TSX staff, they waive or grant exemptive relief from the listing rules, but the qualified applicant’s stocks still trade in the same manner as other TSX listed companies
Hut 8 has recently revealed plans to set up a project that they described as probably the largest cryptocurrency mining farm in North America. The first phase will see Hut 8 acquiring over 22 Bitcoin mining datacenters from BitFury Group.