Introduction
Crypto custody pioneer BitGo’s inaugural public offering, the industry’s first of 2026, has stumbled out of the gate, with shares plummeting nearly 22% on their second trading day. The sharp decline for BTGO stock, which closed the week below its offering price, contrasts with a modestly positive day for broader equity indices and arrives as a Kraken-linked special purpose acquisition company files for its own public debut, highlighting the volatile path for crypto firms seeking traditional market validation.
Key Points
- BitGo's IPO was the crypto industry's first public offering of 2026, raising $212M at a $2B+ valuation.
- The company played a key role in launching Wrapped Bitcoin (WBTC), which peaked near $15B market cap in 2025.
- A Kraken-associated SPAC is preparing its own public offering while exploring merger targets in crypto or other industries.
A Stumbling Debut for Crypto's First 2026 IPO
BitGo’s transition to a publicly traded entity on the New York Stock Exchange under ticker BTGO began with optimism, opening at $18 per share—above its marketed range of $15 to $17. The offering raised over $212 million, valuing the digital asset infrastructure company at just over $2 billion. However, the momentum proved short-lived. By the close of trading on Friday, BTGO shares had tumbled to $14.50, a drop of nearly 22% from the debut price and below the IPO’s target range, erasing hundreds of millions in market capitalization.
This significant second-day drop occurred against a backdrop of stability in the wider market. As of the closing bell on Friday, the S&P 500 had gained 0.03% and the Nasdaq Composite rose by 0.28%. The divergence underscores the specific investor skepticism or profit-taking facing the newly listed crypto firm, distinct from broader economic sentiment. Founded in 2013 by CEO Mike Belshe and CTO Ben Davenport, BitGo recently relocated its headquarters from Palo Alto, California, to Sioux Falls, South Dakota.
BitGo's Legacy and the WBTC Connection
Beyond its custody services, BitGo’s industry footprint is notably tied to the creation of Wrapped Bitcoin (WBTC). Launched in 2019, WBTC is an ERC-20 token that pegs Bitcoin’s value to the Ethereum network, unlocking Bitcoin liquidity for decentralized finance applications. This innovation proved massively successful; by October 2025, WBTC’s market capitalization was hovering near an all-time high of $15 billion. According to data from CoinGecko, that valuation has since receded to approximately $11 billion, reflecting the broader volatility in the crypto asset markets that may also be influencing investor perception of BitGo’s stock.
The company’s leadership remained publicly bullish at the moment of its market entrance. “It’s just so humbling to see that crowd of great people, better team than we’ve ever had, constantly growing and turning this into something out of nothing. It’s amazing,” CEO Mike Belshe said on Thursday while ringing the opening bell at the NYSE. The subsequent share price performance, however, suggests public market investors are applying a more cautious, wait-and-see approach to the firm’s future profitability and growth trajectory in the evolving regulatory and competitive landscape.
Kraken SPAC Signals Continued Public Market Ambitions
Even as BitGo shares corrected sharply, another major player in the crypto ecosystem is advancing its own plans to access public capital. KRAKacquisition Corp., a blank check company or Special Purpose Acquisition Company (SPAC) linked to the Kraken cryptocurrency exchange, has filed to offer 25 million Class A shares at $10 each. In its SEC filing, the entity stated it may pursue a merger with “any business or industry,” confirming it has not yet selected a specific target.
The formation of this SPAC is a strategic partnership, with its sponsor created alongside Kraken and venture capital firms Tribe Capital and Natural Capital. This move indicates that despite BitGo’s rocky post-IPO trading, institutional and crypto-native firms still see the public markets as a viable avenue for growth and consolidation. The planned offering represents a different path to going public compared to BitGo’s traditional IPO, offering potential speed and flexibility in identifying a merger partner, which could be within or adjacent to the crypto sector.
The concurrent narratives of BitGo’s post-IPO volatility and the Kraken-linked SPAC filing paint a nuanced picture for crypto in traditional finance. They demonstrate sustained interest in bringing crypto-adjacent businesses to the public markets while also highlighting the significant valuation risks and investor scrutiny these companies face once their shares begin trading on exchanges like the NYSE and Nasdaq.
📎 Related coverage from: decrypt.co
