On Tuesday, special purpose acquisition company (SPAC) FinTech Acquisition Corp. V announced that it terminated its purposed takeover of Israeli cryptocurrency exchange eToro via a bilateral agreement. In explaining the decision, Fintech V chairman of FinTech V Betsy Cohen said:
eToro continues to be the leading global social investment platform, with a proven track record of growth and strong momentum. Although we are disappointed that the transaction has been rendered impracticable due to circumstances outside of either party’s control, we wish [CEO] Yoni and his talented team continued success.
Last year, eToro and Fintech V announced the SPAC takeover valuing the former at $10 billion. However, it appears that eToro has run into difficulties, possibly due to the ongoing cryptocurrency bear market, and is in need of a capital infusion to enhance its operations. eToro is reportedly considering a private funding round of $800 million to $1 billion, valuing the firm at $5 billion.
Related: 6 Questions for Yoni Assia of eToro – Cointelegraph Magazine
In comparison, Fintech V, which is traded on the Nasdaq exchange and whose sole purpose is to merge with a private company so the latter can “receive” public listing status, has about $250 million in cash held in trust. Nevertheless, Yoni Assia, co-founder and CEO of Toro, assured the public about the state of eToro’s underlying business:
Our balance sheet is strong and will continue to balance future growth with profitability. We ended Q2 2022 with approximately 2.7 million funded accounts, an increase of over 12% versus the end of 2021, demonstrating continued customer acquisition and retention rates that have been improving over time.