IDCM Founder Michael Zhao’s SPAC is successfully listed on Nasdaq

On December 7, US EST, IDCM Founder Michael Zhao initiated the SPAC-Crypto 1 Acquisition Corp (stock code “DAOOU”, hereinafter referred to as Crypto 1), completed the fundraising and successfully landed on the Nasdaq capital market.

Picture | Crypto 1 Acquisition Corp officially landed on Nasdaq

The founder of IDCM, Michael Zhao, as the CEO and co-founder of Crypto 1 led the entire process of Crypto 1’s stock raising and listing.

After the subscription was completed, he wrote on his personal social media: “36 hours with 1.15billion institutional demand and 5.7x over-subscription. It been a hell of a ride. The narrative of finding the coinable of emerging market and use digital exchange as crypto traffic base to disrupt for new financial inclusion. Giddy up.

Picture | Message shared by michael zhao on personal social media

It is reported that Crypto 1 IPO has 20,000,000 units, and each unit is initially priced at $10. Each unit consists of one share of Class A common stock and three-quarters of redeemable warrants. The holder of the warrant has the right to purchase one share of Class A common stock at a price of $11.50 per share, once the securities constituting these units begin Separately traded, Class A common stocks and redeemable warrants are expected to be listed on NASDAQ as “DAOO” and “DAOOW” respectively.

Figure | At 16:00 on December 8, U.S. time, DAOOU has risen to $11.15

About SPAC and Crypto 1

SPAC, with the full name of Special Purpose Acquisition Company, is a special purpose acquisition company, which is a unique form of listing in the U.S. capital market. The sponsor establishes the main body and IPOs for public investors. After the listing, mergers and acquisitions of unlisted entities Integrated capital operation method.

Different from the traditional “IPO listing” and “backdoor listing”, the innovation of SPAC is that instead of buying a shell to go public, it first builds a shell, raises funds, and then conducts mergers and acquisitions, and finally makes the target of mergers and acquisitions a listed company. Compared with the traditional IPO, the SPAC listing model has the characteristics of fast time, low cost, simple process, and guaranteed financing, which has great advantages for investors and target companies.

At present, many well-known companies have paid attention to and participated in the operation of the SPAC model, including the fast food brand “Burger King”, the old entertainment media “Playboy”, the private aerospace company “Virgin Galactic”, and the first hydrogen energy company “Nikola “, China’s first share office “Youke Workshop” and so on.

As the main body of this listing, Crypto 1 has completed its listing on Nasdaq. Next, Crypto 1 will seek to acquire potential blockchain companies. According to the plans of Michael Zhao and other members of the management of Crypto 1, having a certain amount of cryptocurrency exchanges, payment systems, decentralised wallets, decentralised finance and other projects is the focus of attention.

The impact of Crypto 1 listing on IDCM

As we all know, after the US capital market’s adjustment to the listing rules last year, excessive supply makes it difficult for traditional SPACs to stand out.

In response to the fact that crypto1 was favoured by capital and successfully landed on Nasdaq, Michael Zhao introduced that under difficult investment conditions, Crypto1 achieved a 100% institutional investor conversion rate and obtained many international first-line value investments such as Citadel and Apollo. The institution’s cornerstone investment fully demonstrates that investors recognise the capabilities of the Crypto1 management team, and the capabilities have met the investment needs of traditional Wall Street funds for digital assets.

According to reports, Crypto1 will also have more advantages than traditional SPACs in terms of the acquisition period in the future. Crypto 1 will have 12 months to complete the transaction.

As the manager of Crypto 1, Michael Zhao is also the founder of IDCM exchange. It is foreseeable that the successful listing of Crypto 1 will have a positive impact on IDCM. The more significant impact can be summarised as:

A certain degree of certainty of listing: SPAC company will complete the acquisition within 12 months. For the target company to be acquired, it can be listed as long as it meets the corresponding conditions and completes the merger, which is certain of listing. IDCM, as a fast-growing cryptocurrency trading platform with 5 years of technology accumulation, just meets the expectations of Crypto 1’s target acquisition.

Financing is guaranteed: As mentioned in the previous article, Crypto 1 itself has raised more than US$200 million through investor subscriptions to complete the reverse merger with SPAC. Once IDCM leverages Crypto 1, it will be able to obtain financing at the same time as it is listed.

Valuation flexibility: The price at which the SPAC is listed depends on the negotiation between the target company and the management of the SPAC. Compared with the traditional IPO price, which is more affected by the market environment, the SPAC target company has a relatively advantageous negotiating position. Therefore, the risk of being squeezed by securities companies and suppressed by the securities market is much smaller. Once IDCM leverages Crypto 1 to go public, it will have a natural advantage in valuation.

It can be said that because Crypto1 has completed the corresponding IPO process, the preliminary preparations and foreshadowing have been basically completed, and the subsequent target business merger process will be a matter of course. The same is true for IDCM Exchange.