Returns from new US stock listings have declined sharply this quarter amid a cryptocurrency market downturn. Crypto-related IPOs have suffered the most, with shares dropping significantly compared to broader market gains. This environment raises challenges for firms like Grayscale Investments and BitGo Holdings planning public offerings.
New US initial public offerings have underperformed notably in the current quarter, influenced heavily by a crash in cryptocurrency markets. Shares of IPOs that raised more than $50 million—excluding closed-end funds and blank-check companies—have fallen by an average of 5.3%. In contrast, the S&P 500 Index has risen 0.9% over the same period.
The crypto sector has borne the brunt of these losses. Among the five cryptocurrency companies that went public this year, shares have declined an average of 31% this quarter. This downturn has positioned recent crypto IPOs as major casualties, complicating prospects for other players in the space.
Companies such as Grayscale Investments Inc. and BitGo Holdings Inc. now face a steeper hurdle to launch their own IPOs in the near term. The weakened returns signal caution for issuers in the volatile crypto industry, amid broader market dynamics.