Kraken Snatches Crypto Facilities in Nine-Figure Transaction
One of the key cryptocurrency exchanges has announced the acquisition of Crypto Facilities - a regulated trading platform, derivatives, and futures provider.
Kraken has expanded its reach with the acquisition of Crypto Facilities, a regulated provider of trading in spot and futures markets. The exchange announced the deal in a recent press release without disclosing the exact price, saying only the transaction terms value Crypto Facilities at a nine-digit number.
Headquartered in London, the target is a market operator offering round-the-clock trading in various crypto derivatives. It supplies market information to support the CME futures. Crypto Facilities became the first fully regulated platform to offer derivative products for Bitcoin (BTC), Bitcoin Cash (BCH), Ripple’s XRP, Ethereum (ETH), and Litecoin (LTC).
Select Kraken clients will gain access to futures in six cryptocurrency pairs, with the opportunity for hedging and making use of financial innovation.
“I’m thrilled to welcome the Crypto Facilities team into the Kraken family. 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,” commented Jesse Powell, CEO of Kraken.
Powell shared with Fortune magazine that the deal had been in the works for the past 10 months and only recently secured regulatory approval. Thanks to its solid 2018 performance and robust balance sheet, Kraken was able to pay for the acquisition outright, he added.
Crypto Facilities will continue operating from London, remaining under the oversight of the UK Financial Conduct Authority. Kraken claims it has already integrated the trading technology of the acquired company. In theory, select traders could start using the futures markets immediately. However, US-based users will not have access to the futures and derivatives market.
The deal is part of Kraken’s ongoing expansion, which has allowed the company to evolve from a European market to a global operation with increased importance for US-based traders and investors. Kraken acquired smaller exchanges Glidera and CleverCoin and also gave Japan a try, discontinuing that service due to high costs.
The acquisition of Crypto Facilities follows a private round of financing which generated $100 million through an email campaign for current large-scale users.