Straight Up: Coinbase Snags Deribit for $2.9 Billion
Financial Services Firm, Coinbase, Agrees on a $2.9 Billion Acquisition to Obtain Crypto Options Trading Platform Deribit
Street Talk- Coinbase, the big kahuna of US crypto exchanges, just announced it'll buy derivatives exchange Deribit for a cool $2.9 billion.- The deal's breakdown: $700 million in dough and 11 mil shares of Coinbase Class A common stock.
Coinbase's Blog PostThursday saw Coinbase, based in San Fran, California, grinning ear-to-ear, as it dropped the bombshell: it's acquiring Deribit, a digital options exchange.
Here's the lowdown: the whole shebang is valued at $2.9 billion. Break it down, and you've got $700 mil in hard cash and 11 million shares of Coinbase Class A common stock. The fairy tale romance between these two began back in March, with whispers flying around courtesy of the ever-chatty Bloomberg.
"Our derivatives game is about to go stratospheric," Coinbase declared, poised and ready to challenge crypto derivatives giants like Binance and OKX. Deribit's boss, Luuk Strijers, didn't waste time either, firing off a statement: "Coinbasing it with Deribit? Sign us up!"
With the deal likely sealing before the year's end, Deribit's founders, John and Marius Jansen, will bid adieu to the platform, bringing a glorious chapter to a close. Deribit, stationed in Dubai, couldn't be reached for a comment in time.
CG Tusar, Coinbase's VP of Institutional Product, shares the enthusiasm. Though Deribit still can't serve American clients, Tusar's excited, stressing on the unique benefits of consolidating spot, futures, and options under one roof, a feat only a few in crypto can manage.
Post-acquisition, Coinbase shares saw a 4% boost, trading at $205 a pop. The company made its debut on the Nasdaq in '21, and with a market cap over $50 billion, it’s still buzzing.
Beyond facilitating crypto trading, Coinbase also has a contract with the U.S. Marshals Service to manage and dispose of digital assets.
This acquisition reportedly sets Coinbase up to dominate the global crypto derivatives scene. But will that spare it a licking from the regulatory jaws? Only time will tell.
Edited by Stacy Elliott.
The Daily Drop
Morsels of Insight
- Deribit's Surge: In 2024, Deribit reported a near-doubling of its trading volumes to a whopping $1.2 trillion, appealing to growing institutional interest in crypto derivatives[1].
- Regulatory Hurdles: The deal is subject to regulatory clearance and is slated to conclude in the second half of 2025. Deribit is expected to maintain its current operations and brand after the acquisition[1][3].
- Coinbase's Expansion: Acquiring Deribit will support Coinbase's international expansion plans, as the licenses Deribit holds will help cement Coinbase's standing in the competitive crypto derivatives market[1].
- In the realm of cryptocurrency, the acquisition of Deribit by Coinbase for $2.9 billion is a major move, set to revolutionize the US crypto exchange's derivatives game.
- The financing structure of the deal is interesting, with $700 million in cash and 11 million shares of Coinbase Class A common stock exchanged for Deribit.
- Coinbase's foray into crypto derivatives aims to put it on par with derivatives giants like Binance and OKX, a challenge it is poised to accept.
- Deribit's impressive $1.2 trillion trading volumes in 2024, as reported, reflect growing institutional interest in crypto derivatives.
- The acquisition is subject to regulatory clearance, scheduled to close in the second half of 2025, with Deribit retaining its current operations and brand post-acquisition.
- The acquisition is not just a boost for Coinbase's cryptocurrency operations, but also supports its international expansion plans, leveraging Deribit's licenses to enhance its position in the competitive crypto derivatives market.
- While the acquisition is likely to bring significant growth to Coinbase, the question of regulatory hurdles remains, with only time able to provide clarity on the potential impact from regulatory bodies.
