Coinbase sought FTX Europe acquisition after bankruptcy: Report
Crypto exchange Coinbase attempted to acquire FTX Europe twice since it filed for bankruptcy in November 2022, hoping to broaden its derivatives business overseas. The company, however, has decided not to go forward with the deal, Cointelegraph has learned.
According to a report from Fortune, Coinbase explored acquiring FTX's European arm on two occasions, in November last year — following its parent company's dramatic debacle — and in September 2023. A spokesperson for Coinbase confirmed the report:
Along with Coinbase, parties interested in FTX Europe reportedly include exchange Crypto.com and a crypto firm called Trek Labs. According to Fortune, the sale deadline has been extended to Sept. 24. FTX spent nearly $400 million on the acquisition of its European branch.
FTX Europe operated its derivatives business under a Cyprus regulatory license. By the time of the group's collapse, it was the only firm to offer some popular derivatives products, such as perpetual futures. Derivatives are financial instruments whose value is derived from an underlying asset, such as Bitcoin. There are various types of derivatives, including options, futures, and swaps. Investors use derivatives for hedging, leverage, and to speculate on markets. It's a popular investment strategy for traders and institutional investors.
The acquisition would potentially boost Coinbase's fees revenue as crypto derivatives trading is on the rise, despite the bear market. According to Coinbase's latest quarterly earnings report, the exchange generated $707 million in revenue in the second quarter of 2023, with $327 million coming from spot trading — a $13% decline from the previous quarter.
Meanwhile, global derivatives volumes traded on centralized
Read more on cointelegraph.com
