Reports have emerged that Coinbase, one of the largest cryptocurrency exchanges in the world, considered acquiring FTX Europe after the exchange filed for bankruptcy in November. While the acquisition talks were unsuccessful, Coinbase’s interest in FTX Europe highlights the growing importance of derivatives in the crypto industry.
Derivatives, such as perpetual futures, have gained popularity in the cryptocurrency market. According to data from crypto analytics firm Kaiko Research, derivatives volume was six times larger than spot volume in the second quarter of 2023.
In the Pursuit of a Derivatives License
FTX Europe was the only firm offering special crypto derivatives to the European market until its parent company collapsed in November. FTX Europe had obtained the necessary derivatives license after acquiring Digital Assets AG for $376 million in late 2021.
Despite FTX’s bankruptcy, many still see the derivatives license as an attractive asset. Coinbase has shown interest in acquiring FTX Europe, as it has previously acquired the FairX exchange in January 2022 in pursuit of a derivatives license.
FTX Acquisition Remains Possible
Although the initial acquisition talks were unsuccessful, Coinbase has continued to inquire about the possibility of acquiring FTX Europe. The FTX debtors, led by former Enron steward John Ray III, are looking to maximize the sale of FTX’s assets to help customers recover their funds. The deadline for completing the sale has been extended to September 24.
Coinbase is not the only crypto company interested in acquiring FTX. Other companies, such as Crypto.com, FTX FDM, and Trek Labs, have also expressed interest. The FTX Debtors are currently evaluating their options for selling some or all of the assets of the FTX Europe business.
What is FTX Europe?
FTX Europe was a firm that offered special crypto derivatives, specifically perpetual futures, to the European market until it filed for bankruptcy in November.
Why is Coinbase interested in acquiring FTX Europe?
Coinbase is interested in acquiring FTX Europe because of its derivatives license. Derivatives, such as perpetual futures, have become increasingly popular in the cryptocurrency market.
Who are the FTX debtors?
The FTX debtors are the individuals responsible for handling the bankruptcy proceedings of FTX and maximizing the sale of its assets to benefit the customers and creditors.
Are there other companies interested in acquiring FTX Europe?
Yes, besides Coinbase, other crypto companies, such as Crypto.com, FTX FDM, and Trek Labs, have also expressed interest in acquiring FTX Europe.