RedotPay postpones US stock market listing due to legal problems

Stablecoin payments company RedotPay has put its planned US IPO on hold. Legal issues and the absence of the required licences in several countries are causing delays. What was originally on the agenda for later this year may now shift to 2027 or even later.

At a glance:

• RedotPay is postponing its US listing from this year to possibly 2027 or later, due to legal problems and missing licences.
• Binance-related parties are suing RedotPay’s founders for nearly $473 million.
• The company had previously aimed for a valuation of more than $4 billion and wanted to raise more than $1 billion.

Binance lawsuit as a stumbling block

According to Bloomberg, an ongoing lawsuit plays a major role in the decision to postpone the listing. Parties affiliated with Binance have taken RedotPay’s founders to court. The claim amounts to nearly $473 million. The complaint alleges that RedotPay lured more than 470,000 Binance Card users to its own card product, something the claimants say happened unlawfully.

Those accusations throw a considerable spanner in the works for a company preparing for a major capital round. An active lawsuit of that scale makes it unattractive for potential shareholders to step in, and difficult for regulators to give the green light.

Licences and timing

In addition to the legal battle, RedotPay is still awaiting approval from regulators in the countries where it operates. Only once those licences are in order can the company proceed with the preparations for the listing. People familiar with the matter, who wished to remain anonymous because the discussions are internal, told Bloomberg that a listing will now more likely take place next year or later.

RedotPay previously had high ambitions. The company targeted a valuation of more than $4 billion and wanted to raise more than $1 billion through the listing. Those plans are now on ice for the time being. This is not the first time a crypto company has had to adjust its listing plans due to legal or regulatory obstacles, as is also clear from earlier cases in which regulators intervene at crypto exchanges.