Crypto Exchange Coinbase To Acquire Crypto Custody Provider Xapobr>
Citing sources familiar with the matter, The Block reported that is currently negotiating to acquire Xapo, which is headed by Argentinian serial entrepreneur Wences Cesares, for about $50 million. The acquisition is reportedly aimed at boosting Coinbase’s own crypto custody business, which has a strong competitor in the face of Fidelity’s digital currency wing – Fidelity Digital Assets.
Following the closure of the deal, Coinbase will pay $50 million in cash for Xapo, plus a contingent earn-out for remaining with the company.
Xapo, founded in 2014, provides a bitcoin wallet and a cold storage vault, as well as bitcoin debit card services. It is backed by leading industry players such as venture capital firms Greylock Partners and Index Ventures, crypto investment companies Digital Currency Group, Winklevoss Capital and Blockchain Capital. The firm reportedly holds as much as $5.5 billion of assets under custody (AUC).
Since its founding, Coinbase has already acquired 14 companies, including ethereum startup service Paradex and crypto social network Earn.com.