Coinbase, the largest U.S. cryptocurrency exchange, is signaling an aggressive expansion strategy following its recent $2.9 billion agreement to acquire Deribit, a leading crypto derivatives platform.
CEO Brian Armstrong has indicated that the company is actively exploring additional mergers and acquisitions to bolster its global presence and product offerings.
In an interview on Bloomberg Television, Brian Armstrong said Coinbase is considering other mergers and acquisitions (M&A). He also emphasized that M&A was key to the company’s long-term strategy.
The platform, which has over 35 million users, is among the most active dealmakers in crypto. Its purchase of Deribit earlier this month is its largest since it went public in 2021. The deal, which includes $700 million in cash and 11 million shares of Coinbase, cements the company’s position in the booming market for cryptocurrency derivatives.
Coinbase drives global expansion with aggressive acquisition spree
The purchase of Deribit will lead to strategic expansion into the global market. The cryptocurrency derivatives exchange, which relocated its platform to Dubai earlier this year, is the market leader in Bitcoin and Ether options, supposedly clearing over 90% of international crypto options trades.
Its purchase also plants Coinbase firmly in the ranks of the international scene for crypto derivatives—a segment of the market that institutions are increasingly gravitating toward in favor of more structured financial products.
Armstrong said the international deal is probably a sign of things to come in future acquisitions. Coinbase is particularly interested in businesses that “think similar” and have the potential to help them grow and innovate faster. While Coinbase has been linked to several potential acquisition targets, Armstrong declined to confirm specific plans.
When asked whether Coinbase might pursue a deal with Circle, the issuer of the USDC stablecoin and its current partner in a revenue-sharing agreement, Armstrong said there was no announcement to share. Circle, which filed for a public listing last month, has been the subject of acquisition rumors ever since it reportedly rejected a buyout offer from Ripple for being undervalued.
Institutional demand supports new entry signals in the S&P 500
Coinbase isn’t only growing through acquisitions. The company will also make history next week as it enters the S&P 500 index — becoming the first crypto-native company to become a member of the prestigious index.
Markets were already reacting to the announcement. Shares of Coinbase surged 24% after the S&P 500 announcement. Today, the stock is up nearly 4% for the year, recovering from the intense volatility of 2022 and 2023, when heightened regulatory pressures weighed heavily on the broader crypto market.
The S&P 500 listing is a major milestone for Coinbase and the wider crypto industry. Analysts view it as a resounding endorsement of the legitimacy and maturity of digital assets in mainstream finance.
The S&P 500 is a stock market index that tracks the performance of the 500 largest publicly traded companies in the United States, with a combined market capitalization of around $47 trillion. It provides a broad snapshot of the U.S. stock market and is commonly used as a benchmark to assess the overall health of the equity market.
Coinbase’s latest moves reflect the ambitions of a rising force in digital banking, positioning itself at the forefront of a new era in finance. As U.S. crypto regulations begin to stabilize and institutional adoption gains momentum, the company is setting its sights on becoming a vital “bridge” between traditional financial systems and blockchain-based markets.
The company’s achievements follow years of legal disputes between it and the Securities and Exchange Commission (SEC), with the agency ultimately dropping its lawsuit against the exchange in February.
“Imagine battling the SEC for years, only to ascend to the S&P 500 just months later. There’s no worthier steward of this victory than Coinbase,” said Bitwise Head of Alpha Strategies Jeff Park in a Monday X post.
Coinbase CEO Brian Armstrong highlighted that the milestone signifies “crypto is here to stay.”
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Source: https://www.cryptopolitan.com/coinbase-ceo-teases-more-crypto-takeovers/