Coinbase Acquires Xapo’s Institutional Custody Business!
Coinbase bought the Xapo crypto custody service for $55 million!
The goal? To Become the world leader in the deposit and custody of crypto assets for institutional investors.
The news was announced in an article on the blog coinbase.
‘Today, we are announcing that Coinbase Custody has completed an acquisition of Xapo’s institutional businesses.
This acquisition caps off a tremendous period of growth and innovation for Coinbase Custody.
In just over one year since launch, Coinbase Custody has grown to over $7 billion in Assets Under Custody (AUC) stored on behalf of more than 120 clients in 14 different countries, making it the largest, most globally recognized and most trusted institutional custodian in the world.
From the start, our goal has been to build the trusted foundation for institutional investment in Bitcoin (BTC) and crypto assets in general. We’re thrilled to help enable some of the tremendous demand for this emerging asset class.’
Coinbase now controls more than $7 billion in cryptocurrency assets and this is just the beginning.
The Fidelity investment company also wanted to buy the Xapo custody service, but Coinbase presented a more attractive offer.
Xapo will keep the crypto exchange activities.
The founder of the company, Wences Casares, will remain as CEO.
He said that the management of retail customers’ stock transactions has always been Xapo’s main task: ‘This year, we started to look who it could be transmitted to.’
Casares also noted that the other candidates did not have adequate security or regulatory recommendations.
These include, for example, Grayscale Investments, a digital asset management company.
According to sources, most of Xapo’s major customers have agreed to transfer their assets under the management of Coinbase, which has enabled more than 514,000 bitcoins to be transferred.
Xapo’s remaining customer accounts would have assets in excess of $3.5 billion.
If Coinbase manages to attract them as well, there will be more than 860,000 bitcoins in its vaults.
Prior to the acquisition, Xapo Coinbase Custody held assets in excess of $1 billion.
Rumors about the possibility of an agreement between Coinbase and Xapo appeared in May, but it took several months to resolve the issues, including the transfer of customer assets and the determination of the owner of the Xapo safe in Switzerland.
Casares said the safe will stay with his company and will be used to store bitcoins for retail customers.
Coinbase therefore reinforces its leadership position in crypto-level institutions that are gradually entering the Bitcoin and cryptocurrency market.
Institutional investors need security before investing and risking their money in cryptocurrency when you know that it is easy to steal cryptocurrency if you can have access to their storage.
