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Until the collapse of FTX in November, FTX Europe was the only company offering specialized crypto derivatives (perpetual futures) in the European market.
Such news has come to light coinbase Considered acquiring FTX Europe following the exchange’s bankruptcy in November. While acquisition talks were not successful, Coinbase’s interest in FTX Europe underscores how important derivatives have become to Coinbase’s global strategy.
While spot trading volumes have declined significantly, derivatives are in greater demand. Data from crypto analytics firm Kaiko Research showed that derivatives volume in Q2 2023 was six times larger than spot volume. This shows that derivatives are becoming more popular.
Looking for derivatives license
Until the collapse of FTX in November, FTX Europe was the only company offering specialized crypto derivatives (perpetual futures) in the European market. The company obtained the necessary licenses after acquiring Digital Assets AG in late 2021 for $376 million.
The platform continued to gain thousands of users until its parent company declared bankruptcy. However, many still consider the derivatives license as a reason to acquire a share of FTX assets.
FTX Europe is not the only entity with a derivatives license that Coinbase has tried to acquire. First, Coinbase acquired FairX Exchange in January 2022. A Coinbase spokesperson said:
“We are always evaluating opportunities to strategically expand our business and join forces with multiple teams around the world.”
FTX acquisition remains on the table
Despite earlier acquisition talks hitting a wall, Coinbase was still fielding inquiries about the possibility of an acquisition in September. Thus, it is possible that Coinbase may still be able to acquire the defunct FTX Europe.
According to LuckFTX debtors, led by former Enron manager John Ray III, hope to maximize profits by selling FTX’s assets to enable customers to get their money back. As a result, the team is planning to hold off on selling for as long as possible. Thus, the deadline to complete the sale has been extended to September 24.
Apart from Coinbase, several other crypto companies have also attempted to acquire FTX. Some notable ones include Crypto.com, FTX FDM, and Trek Labs. Thus, the FTX Debtors are continuing to evaluate whether there are viable alternatives to the sale of some or all of the assets of the FTX Europe business.
An experienced writer with practical experience in the fintech industry. When he is not writing, he spends his time reading, researching, or teaching.
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