Prime Broker Pulls IPO After 40% Valuation Cut as Crypto and AI Fears Collide

Clear Street shelved its initial public offering (IPO) on Thursday, just hours after cutting the deal's size from $1.05 billion to $364 million in a last-ditch attempt to salvage the listing.

The New York-based prime broker Prime Broker Prime brokers are the designation given to individuals handling a package of services offered by investment banks, wealth management firms, and securities dealers to hedge funds which need the ability to borrow securities and cash in order to be able to invest on a netted basis and achieve an absolute return.There are two types of prime brokers - bank and non-bank corporations. Traditionally major global investment banks have been the predominant players in the space, however recent years have p Prime brokers are the designation given to individuals handling a package of services offered by investment banks, wealth management firms, and securities dealers to hedge funds which need the ability to borrow securities and cash in order to be able to invest on a netted basis and achieve an absolute return.There are two types of prime brokers - bank and non-bank corporations. Traditionally major global investment banks have been the predominant players in the space, however recent years have p Read this Term cited "market conditions" for scrapping Friday's planned Nasdaq debut and said it would reconsider the listing later. The withdrawal marks the second major IPO postponement in a week, following Blackstone-backed Liftoff Mobile's decision to pull its $762 million offering on Feb. 5 amid a software sector rout.

Clear Street had already trimmed its ambitions significantly before pulling the plug entirely. The firm cut its offering from 23.8 million shares priced at $40 to $44 each down to 13 million shares at $26 to $28. That would have valued the company at roughly $7.2 billion at the top of the revised range, compared to an initial target of $11.8 billion.

Revenue Surges as Valuation Ambitions Collapse

The firm expects net revenue between $1.04 billion and $1.06 billion this year, more than double its 2024 figure of $463.6 million. That growth came largely from Clear Street's expansion beyond its original prime brokerage platform into investment banking and equity research since its 2018 founding.

But investors balked at the initial valuation, according to Bloomberg. The firm encountered pushback on its pricing expectations even before Thursday's attempted downsizing.

• BitGo Takes the First Swing for Crypto Custody IPOs, Chasing Nearly $2B Valuation
• Kraken Files for US IPO After Securing $800M Funding
• After Successful IPOs of Bullish and eToro, Crypto Lender Figure Also Seeks Wall Street Debut

The pricing was scheduled for Thursday evening, with trading set to begin Friday under the ticker "CLRS".

Even companies that managed to go public have little reason to celebrate. eToro, trading under the ticker ETOR, has been listed on Wall Street for nearly a year and has fallen about 60 percent over that period.

Meanwhile, another publicly traded broker, NAGA Markets, carried out a 10-for-1 reverse stock split at the end of 2025. According to management, the company’s penny-stock status “does not accurately reflect the operational profile.” The shares are currently valued at €3, which would have been €0.30 before the split.

The latest results, however, align with the weak share price, showing EBITDA for 2025 at roughly one-third of the level reported in 2024, when it stood at €9 million.

Crypto Exposure Compounds AI-Driven Selloff

Clear Street's role as an underwriter for cryptocurrency-related capital raises likely amplified investor concerns. The firm has served as underwriter for multiple crypto treasury offerings, particularly Strategy's recent fundraising rounds.

"The recent AI-driven selloff in financial stocks likely dampened investor sentiment, but the sharp decline in crypto markets also had an impact as Clear Street has served as underwriter for multiple crypto treasury capital raises, particularly Strategy's latest offerings," said IPOX Research Associate Lukas Muehlbauer.

Broader volatility has rattled the IPO market in recent weeks. Software and IT stocks tumbled earlier this month on fears that AI-first offerings would disrupt existing business models, dragging down shares of Wall Street brokerages on Tuesday.

Ripple Effects Across Markets

The postponement could prompt other companies planning listings to reconsider their timing. Clear Street was coming off what the source material described as a "banner year," making the withdrawal particularly notable.

Brazilian fintech Fintech Financial Technology (fintech) is defined as ay technology that is geared towards automating and enhancing the delivery and application of financial services. The origin of the term fintechs can be traced back to the 1990s where it was primarily used as a back-end system technology for renowned financial institutions. However, it has since grown outside the business sector with an increased focus upon consumer services.What Purpose Do Fintechs Serve?The main purpose of fintechs would be to suppl Financial Technology (fintech) is defined as ay technology that is geared towards automating and enhancing the delivery and application of financial services. The origin of the term fintechs can be traced back to the 1990s where it was primarily used as a back-end system technology for renowned financial institutions. However, it has since grown outside the business sector with an increased focus upon consumer services.What Purpose Do Fintechs Serve?The main purpose of fintechs would be to suppl Read this Term Agibank slashed its offering size just a day before its Feb. 11 debut, following weak post-IPO performance by rival PicPay. PicPay's shares have fallen roughly 20% since its January listing, the first IPO by a Brazilian company in more than four years.

SBI Holdings took a $50 million minority stake in Clear Street in January, establishing a joint venture focused on prime brokerage services in Japan. Last May, the firm launched an outsourced trading desk led by former UBS executive Morgan Ralph.