8-K: Thunder Bridge Capital Partners IV Announces Business Combination with Coincheck

Thunder Bridge Capital Partners IV is set to merge with Coincheck, a Japanese cryptocurrency exchange, to facilitate its public listing in the United States.

Summary

• Thunder Bridge Capital Partners IV is pursuing a business combination with Coincheck, a Japanese cryptocurrency exchange, to become publicly listed in the United States.
• The definitive proxy statement/prospectus was mailed to Thunder Bridge IV's stockholders on October 25, 2024.
• Coincheck has over 2 million accounts and supports 30 different crypto assets.
• The company has $5.2 billion in customer assets and $2.1 billion in LTM Q2 25 marketplace trading value.
• Coincheck experienced 27% year-over-year revenue growth in FY24 and $33 million in LTM Q2 25 EBITDA.
• Japan's digital asset adoption is relatively low, presenting a significant growth opportunity for Coincheck.
• Coincheck holds the number one domestic market share for five consecutive years and has 6.51 million downloads.
• The majority of Coincheck's users are in their 30s or younger.
• Transaction revenue makes up 92.5% of Coincheck's total revenue, with an average spread of 3.42%.

Sentiment

Score: 7

Explanation: The document presents a positive outlook for Coincheck's growth and market position, with strong financial metrics and a clear strategy for expansion. However, there are also risks associated with the business combination and the volatile nature of the crypto market.

Positives

• Coincheck has a strong track record of growth and is the first crypto account for many users.
• The company has a broad product set and a strong customer base.
• Coincheck is the number one domestic market share for five consecutive years.
• The company has a customer-centric product strategy, with a large portion of users being young.
• Coincheck has a high percentage of revenue from transactions, indicating a strong core business.
• There is a massive untapped market opportunity in Japan for crypto adoption.

Negatives

• Japan's digital asset adoption is relatively low compared to other countries of similar economic size.
• The company's non-transaction revenue is a small portion of total revenue.

Risks

• The business combination may not be completed due to various factors, including failure to obtain shareholder approval or meet Nasdaq listing standards.
• There are risks related to changes in the cryptocurrency and digital asset markets.
• Coincheck may not be able to execute its growth strategies or develop and maintain effective internal controls.
• The company is subject to risks related to disruption of management's time from ongoing business operations due to the proposed business combination.
• There is a risk of a delay or failure to realize the expected benefits from the proposed business combination.

Future Outlook

The company aims to solidify its position as a leading Japanese crypto exchange, expand its non-transaction-based offerings, introduce new digital asset products, and capitalize on the institutional opportunity in crypto.

Management Comments

• The mission is to increase the accessibility of new forms of investing and commerce for our highly-engaged customer base.
• Coincheck is undergoing a business combination with Thunder Bridge to become publicly listed in the United States.

Industry Context

The announcement comes amid a growing interest in cryptocurrency and digital assets, with Japan being a market with significant untapped potential. The merger aims to capitalize on this trend and establish Coincheck as a major player in the global crypto market.

Comparison to Industry Standards

• Coincheck's 2 million+ accounts are comparable to other major crypto exchanges globally, but its market share in Japan is particularly strong.
• The 27% YoY revenue growth is a positive sign, indicating strong performance in a competitive market.
• The $33 million LTM Q2 25 EBITDA is a key metric for profitability, and it will be important to compare this to other exchanges of similar size.
• Coincheck's focus on the Japanese market is a strategic move, given the relatively low crypto adoption rates compared to other developed nations, such as the US and UK, where companies like Coinbase and Kraken operate.

Management Changes

Stakeholder Impact

• Shareholders of Thunder Bridge IV will have the opportunity to vote on the proposed business combination.
• Employees of Coincheck may experience changes as the company transitions to a publicly listed entity.
• Customers of Coincheck may benefit from the company's growth and expansion.
• The merger could impact suppliers and creditors of both Thunder Bridge IV and Coincheck.

Next Steps

• The parties will seek shareholder approval for the business combination.
• The company will work to meet Nasdaq listing standards.
• Coincheck will continue to execute its growth strategies and expand its product offerings.

Key Dates

Keywords

Coincheck, cryptocurrency, business combination, Thunder Bridge Capital Partners IV, digital assets, Japan, IPO, EBITDA, revenue, market share