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 Kraken acquires UK based crypto trading and indexing firm for north of $100 million

 

Kraken acquires UK based crypto trading firm, 'Crypto Facilities' for $100 million

 

Kraken is a San Francisco based cryptocurrency exchange that claims to be the most secure Bitcoin exchange. The company recently made headlines when it acquired Crypto Facilities, according to InWara’s M&A database for at least $100 million.

 

Through this M&A deal, the management teams of both company’s hope to create a global leader in crypto futures and spot trading as Crypto Facilities and Kraken is renowned in the crypto trading space. As CEO and Founder of Crypto Facilities-Timo Schlaefer was quoted saying “It has been our mission to build the most sophisticated, powerful and user-friendly cryptocurrency trading platform. Teaming up with Kraken allows us to innovate the next generation of products and tremendously boosts the value we are able to provide to our clients”, suggesting the ambitious goals of both companies.

 

Crypto Facilities is a London based, trading platform and index provider of cryptocurrencies that offers its users safe and secure derivatives trading around the clock. Interestingly Crypto Facilities claim to be the first regulated exchange to offer futures on Bitcoin, Ethereum among several other major cryptocurrencies.

 

Kraken is one of the world’s largest global Bitcoin exchange (Euro volume and liquidity). In the past Kraken has allegedly achieved several feats like the first Bitcoin exchange to pass a cryptographically verifiable proof-of-reserves audit and the first to offer clients the opportunity to participate in leveraged bitcoin margin trading. The company also calculates and administers the CME CF Bitcoin reference rate which is the backbone of CME Group’s Bitcoin futures.

 

Kraken: Aggressive acquirer 

 

Kraken has been strategically acquiring Blockchain enterprises from around the world. According to InWara’s M&A database, its acquisition of Crypto Facilities will mark Karken’s sixth major deal till date. Some of the marquee assets include the renowned trading and portfolio tracking platform Cryptowatch, digital wallet-funding service Glidera, and several major bitcoin exchanges such as Coinsetter, Cavirtex and CleverCoin.

 

The prolonged ‘crypto winter’ has made market conditions unfavourable for Blockchain and crypto enterprises and is likely the reason for the surge in consolidation being observed in the market. 2019 has forced many ICOs to either close up shop or go for strategic partnerships to help survive these adverse conditions.

 

# of M&A deals in Blockchain and crypto market

number of M&A deals in crypto space

Source: InWara’s monthly report: January 2019

 

Other significant acquisitions of 2019 include, Coinbase acquiring data handling startup Blockspring. Bakkt’s acquisition of certain assets of Chicago-based futures commission merchant Rosenthal Collins Group (RCG) and EZ Advance acquiring Indian digital payment start-up Alconomy to expand their business into digital banking.

 

Coinbase, Kraken’s competitor, is a San Francisco based digital currency exchange and according to InWara’s M&A database, the company has made eleven acquisitions till date, the latest being that of Blockspring. To know more about Coinbase and its strategic acquisitions check out InWara’s article.

 

Kraken expanding to Europe

 

Through the acquisition of UK based Crypto Facilities, Kraken hopes to cement its place in the crypto market space. Interestingly according to InWara’s monthly report: January 2019, The UK crypto market space is booming despite the unfavourable market conditions, even racing past the US in terms of number of ICOs. CEO of Kraken-Jesse Powell was quoted saying “We are excited to introduce eligible clients to these industry leading futures and index products. Over the coming months, our teams will continue to enhance and expand these offerings. We’ve got great stuff in store for traders and institutional clients in 2019” suggesting the company has plans to continue to acquire companies that give Kraken a strategic edge.

 

# of ICOs according to country in January 2019

ICO Data by country

Source: InWara’s ICO+STO database

SEC has been clamping down on ICO sales in the US likely leading to depreciating trend being observed in 2019, while Singapore and the UK have been creating conducive environments with crypto-friendly rules and regulation.

 

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