Nasdaq CEO hopes IPOs will be more in 2023 as she calls for crypto regulations
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The chief executive officer at Nasdaq Inc, Adena Friedman, has said that she expects initial public offerings during the first half of 2023 to remain low. Investors will continue being cautious during the first six months of the year before market activities pick up in the second half.
Nasdaq CEO hopes IPOs will increase in 2023
While speaking at an interview during the Reuters NEXT Conference, Friedman said that around 200 companies were in the pipeline on the Nasdaq exchange. This number is below the 250 to 300 companies during the previous years.
In 2021, Nasdaq recorded a record number of IPOs with more than 750 new listings. These listings were driven mainly by the growing popularity of special purpose acquisition companies (SPACs).
However, this trend has reversed in 2022. The high inflation has led to the Federal Reserve aggressively increasing interest rates. This has resulted in investors shying away from investing in risk assets.
During the first nine months of 2022, Nasdaq recorded 143 IPOs. This number was significantly low compared to the 557 IPOs recorded during the first nine months of 2021.
Friedman expects that the trend will change in 2023 as market fears ease. The Fed is expected to slow down interest rate hikes as inflation shows signs of dropping. This could increase interest in the stock market, and companies will become more comfortable listing their stocks.
Nasdaq’s interest in crypto
According to Friedman, Nasdaq Digital Assets, a cryptocurrency custody division, will be launched during the first half of 2023. Nasdaq announced plans to venture into crypto custody in September this year and is currently awaiting regulatory approval.
It is not the first time that Nasdaq is venturing into the crypto industry. In the past, the trading platform has provided cryptocurrency exchanges with technology supporting trading and surveillance.
However, Friedman believes that the digital asset space needs clear regulations to onboard institutional investors. She added that regulations should also support innovation while assuring investors of a safe and sound ecosystem.
Crypto asset prices have declined significantly this year. The bear market has led to the bankruptcies of some popular crypto firms, such as Celsius, Three Arrows Capital FTX, and BlockFi.
The failure of FTX has affected crypto prices, with the total cryptocurrency market capitalization falling below $900 billion. FTX has an estimated one million creditors. The exchange’s fallout has also led to the failure of other crypto firms exposed to FTX, including Genesis and BlockFi.
