There was another black eye for cryptocurrency and bitcoin this week when of the most anticipated IPOs from Bitcoin Group was pulled when concerns about capitalization of the company were raised by regulators. Bitcoin Group Limited which is an Australian bitcoin mining firm and based is based out of Melbourne Australia. The company was seeking to be listed on the Australian securities exchange or ASX. In the meantime, Bitcoin Group will be repaying investors the AUD 5.9 million it acquired in the raise. ASIC, the Australian regulator, was concerned with the company forecasting and basing the company accounting on the future valuation of BTC cryptocurrency.
What is more troubling about this cryptocurrency IPO is that the capital requirement is not one of the criteria for listing, but regulators felt there was a need to get clarity on this matter. This is the sixth time that Bitcoin Group has been forced to delay their IPO and is also fell considerably short of their goal of AU$20 million. Bitcoin has seen its share of private investment some of which is well known but has not become has not made much of an impact in the IPO market.
Somewhere there is a disconnect between the private and public markets. Private investment in Bitcoin-related business was near $500 million in 2015. VC interest in the sector is growing, and there is no shortage of startups. One of the most significant hurdles that Bitcoin and its business face is regulation and the uncertainty of how different governments and their respective regulators choose to classify Bitcoin and Cryptocurrency. Anonymity which is one of the reasons Bitcoin had grown as an alternative currency is also a significant issue with governments that are concerned about Anti-Money Laundering and terrorist financing. At some point, each of these governments will need to decide or determine what Bitcoin is and how to regulate it.
Bitcoin itself is a unique product and will take some time for the conventional world to catch up.