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The transaction is anticipated to yield up to $300 million in cash, which will be allocated to enhance the company’s institutional crypto lending, yield, and custody services.
Abra plans to list on Nasdaq via a SPAC agreement. (sergeitokmakov/Pixabay, modified by CoinDesk)
What to know:
- Crypto wealth platform Abra announced intentions to go public on Nasdaq through a $750 million SPAC merger with New Providence to enhance its services.
- The deal is projected to provide up to $300 million in cash, which will be utilized to augment its institutional crypto lending, yield, and custody services.
- After reaching settlements with U.S. regulators regarding previous offerings, Abra ceased its retail operations and now focuses solely on institutional and high-net-worth clients.
Crypto wealth platform Abra has revealed plans to become public through a merger with special purpose acquisition company New Providence Acquisition Corp. III, in a deal that values the company at $750 million.
The merged entity will be renamed Abra Financial Inc. and is anticipated to be listed on Nasdaq under the ticker ABRX, as per an announcement.
The transaction could generate as much as $300 million in cash from the SPAC’s trust account, although the ultimate amount is contingent on shareholder redemptions and transaction costs.
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Founded in 2014 and headquartered in San Francisco, Abra offers a variety of services for crypto investors. Its platform enables institutions, registered investment advisers, family offices, and affluent individuals to store cryptocurrencies, trade numerous tokens, earn yields, and borrow against their assets.
Assets are maintained in separate accounts known as vaults rather than appearing on the company’s balance sheet. The firm functions as an SEC-registered investment adviser and positions its services as a link between traditional wealth management and cryptocurrency markets.
Abra indicated that the funds from the transaction will facilitate product development, recruitment, and expansion into sectors such as tokenized real-world assets and decentralized finance.
The company has reported “hundreds of millions of dollars in assets” under its management and aims to surpass $10 billion by 2027.
Abra was established by CEO Bill Barhydt as a mobile crypto wallet and remittance application aimed at retail users. During the last crypto bull market, the firm broadened its offerings to include lending and yield products via its Abra Earn program and secured $55 million in 2021 from investors such as Blockchain Capital, Pantera Capital, and RRE Ventures.
After facing regulatory challenges regarding certain aspects of its lending operations, Abra altered its strategy. In 2023 and 2024, Abra settled with U.S. state regulators and the Securities and Exchange Commission concerning unregistered lending and securities offerings.
The company discontinued its U.S. retail operations and refunded customers before restructuring its business to focus on institutional and high-net-worth clients through its SEC-registered investment division, Abra Capital Management.
The proposed merger awaits approval from shareholders and regulators prior to finalization.
