The US giant cryptocurrency Coinbase would be negotiating the acquisition of Xapo for about $ 50 million. There will surely be a price supplement to strengthen the crypto-purse’s daycare activities, according to sources close to the subject.
Coinbase and Fidelity Digital Asset vie for Xapo
Coinbase has been in competition for several weeks with Fidelity Digital Asset for the purchase of Xapo , in order to strengthen its position as the first cryptocurrency storage company. Fidelity believes that Xapo would be an excellent entry point into the cryptocurrency industry.
Nevertheless, the negotiations are still far from being concluded. Xapo represents more than 700,000 BTC in custody, or $ 5.5 billion.
A media report reads as follows:
“According to rumors, the company holds up to $ 5.5 billion in assets under custody (AUC) at the current price of nearly $ 8,000 [per BTC], reflecting ~ 700,000 bitcoins in custody. Xapo holds 226,000 BTCs that are part of Grayscale Bitcoin Trust “.
The addition of AUC billions would be a big boost for Coinbase, especially since Xapo does not charge for the storage of Bitcoin. It generates revenue through transactions for customers who use Bitcoin in custody.
A strategic acquisition that attracts many investors
Launched in 2014, Xapo is a Hong Kong-based company, a digital wallet provider that stores BTCs and a digital safe available to its customers, as well as Bitcoin debit card services. Xapo has been able to raise 40 million dollars since 2012.
Xapo’s rival investors include Silicon Valley venture capital firms Greylock Partners and Index Ventures, cryptocurrency firms Winklevoss Capital and Blockchain Capital.
High-level investors like Max Levchin and David Marcus – the head of Facebook’s cryptocurrency initiative – are also in the running.
Earlier this month, Coinbase Custody was able to manage $ 1 billion worth of assets in just 12 months after launch. 70 institutions have joined the service during this period according to Brian Armstrong , the CEO of Coinbase.
What do you think of the fierce competition around the acquisition of Xapo? Comment in the comment section below.