In a landmark move for European retail investment, Republic Europe, the EU division of the U.S.-based Republic platform, has launched a novel financial product granting individual investors indirect exposure to the valuation of cryptocurrency exchange Kraken. This offering, structured as a Special Purpose Vehicle (SPV), is described as a first-of-its-kind private-market product for retail investors in Europe, strategically expanding access to high-growth crypto infrastructure companies traditionally reserved for institutions.
The SPV structure pools capital from multiple investors, allowing the vehicle to acquire an interest in Kraken, likely through secondary market shares. Investors thus gain exposure to Kraken's value fluctuations without holding direct equity, bypassing the typical high minimum investments and accreditation requirements associated with private company shares. Republic Europe, regulated by the Cyprus Securities and Exchange Commission (CySEC), provides a regulated framework for investors within the European Economic Area.
The launch responds to growing retail demand for exposure to the foundational "picks and shovels" companies of the crypto ecosystem. Kraken, founded in 2011, is one of the world's oldest and most reputable exchanges, reporting over 13 million global users. According to figures cited by Republic Europe, Kraken generated $1.6 billion in revenue in 2024, a 138% year-over-year increase, with an EBITDA of $421 million. The exchange has strategic backing from firms like Citadel Securities and Jane Street.
This product arrives amid Kraken's preparations for an eventual initial public offering (IPO). In November, Kraken confidentially filed for a U.S. IPO following a valuation milestone of around $20 billion. The SPV structure offers a potential liquidity path for investors; if Kraken goes public, the SPV's holdings could convert to publicly traded stock. Theodora Bishop, senior investment manager at Republic Europe, stated the product aims to bring "private-market quality into the public sphere," addressing the trend of companies staying private longer and limiting mass access to significant wealth creation opportunities.
While innovative, the model carries specific risks. The investment's value is tied to Kraken's opaque private market valuation, and liquidity is constrained—investors cannot easily sell their SPV interest and may need to wait for a liquidity event. Fees associated with the SPV structure and concentration risk in a single company are also key considerations. Analysts view this as part of a broader trend of asset democratization, potentially establishing a blueprint for similar offerings targeting other major private crypto companies.
