WonderFi to Merge with Coinsquare?

Bloomberg reported that a possible merger between WonderFi and Coinsquare will see the creation of a crypto exchange which will have over 1 Million clients.

WonderFi Technologies is a company that provides access to decentralized finance (DeFi). Reportedly, it has been mulling a merger agreement with the trading platform Coinsquare.

Coinsquare is a Canadian cryptocurrency exchange and is regulated by the Investment Industry Regulatory Organization of Canada. In November 2022, Coinsquare suffered a data breach.

With the merger, the two companies aim to form the largest cryptocurrency exchange in Canada.

Bloomberg mentioned in its report that WonderFi and Coinsquare have been in advanced merger talks. Meanwhile, WonderFi did not make any further statements, and has added that the discussions do not guarantee a collaboration:

“These discussions are preliminary in nature and are ongoing, and no assurance can be given that any agreement or agreements will be reached, or that the terms of a transaction will be agreed upon, or that a transaction will be completed. The company does not intend to make further comment unless or until an agreement has been entered into and there is a transaction to announce.”

If the merger happens, the new firm would cater to more than 1.5 million clients since WonderFi has almost 650k and Coinsquare has 500k users.

It must be noted that the exact terms of the deal are unclear.

However, Coinsquare stakeholders might obtain a majority stake in the organization formed after the merger and even own more seats on the Board of Directors.

Furthermore, WonderFi (WONDF) saw its share price move upward shortly after rumors of the merger emerged. At the weekend, the share price closed at $0.2301 with a 5.91% increase.

WonderFi is financially backed by the billionaire investor Kevin O’Leary. It strengthened its market presence in April last year by buying the Toronto-based cryptocurrency exchange – Bitbuy Technologies for around $163 million and after a week later, it bought Coinberry, another Canada based digital asset trading platform, for approximately $30 million.

Coinsquare is the first Canada-based crypto firm to become a member of the Investment Industry Regulatory Organization of Canada (IIROC) in October 2022. The registration forced the crypto firm to separate client assets via a licensed custodian and keep more capital on hand.

Additionally, the Canadian Investment Protection Funds ensure the cash held in customer trading accounts.

Recently, Coinsquare was close to acquiring its rival CoinSmart Financial which would have put two of Canada’s crypto giants under the same roof. However, CoinSquare eventually withdrew from the deal after taking into account the “unacceptable costs and risks” associated with the deal.