Announced on Wednesday, top Bitcoin exchange Kraken has made a large acquisition, picking up Interchange.
Interchange is an accounting and reporting service for institutions with operations in the cryptocurrency market, meaning that this purchase is one of Kraken’s latest attempts to make a splash in the institutional side of the industry.
Kraken Picks up Interchange
With Interchange, institutional clients of Kraken will be able to better manage their portfolios. The service offers “institutional-grade” crypto-centric accounting, reconciliation, and reporting services that cater to industry hedge funds, asset managers, and other firms with digital asset holdings in the space. The press release reads:
“Interchange offers professional-grade accounting and portfolio reconciliation tools designed specifically for the nuances and complexities of digital asset markets. Founded to improve access to crypto markets, Interchange enables institutional investors to better monitor and report their cryptocurrency holdings.”
In an industry that is so heavily scrutinized by the taxman, Kraken’s move to Interchange is likely a move that will draw a lot of interest from “whales” in the cryptocurrency market.
This transaction sees Kraken acquihire Interchange’s co-founders, Dan Held and Clark Moody. Bitcoin pioneer Held formerly worked as the director of product at Blockchain.com and as an employee at Uber.
Moody hails from RTBTC, a trading platform that Blockchain.com acquired. It is unclear if Interchange’s other staffers will be joining the San Francisco-headquartered exchange.
Interchange brings over 60 institutional clients to Kraken. The clientele includes MG Stover, “the world’s largest fund administrator for digital asset funds.”
This is Kraken’s latest in a string of acquisitions made this year. The company, which recently raised over $13 million through private equity investment platform Bnk To The Future (an evident play on “Back to the Future”), earlier this year spent over $100 million on purchasing Crypto Facilities, a futures platform.
The “nine-figure” transaction saw the exchange pick up the futures giant, which offered cash-settled futures vehicles for Bitcoin, Bitcoin Cash, Ethereum, Litecoin, and XRP.
CEO Jerome Powell claimed in the wake of that play that the acquisition brought Kraken’s developer count to “over 100” and accelerated Kraken’s timeline in terms of adding assets.
And earlier this month, it acquired Cryptofinance.ai, a data analytics services that are presumably centered around providing assets to institutional clients.
It is clear that Kraken is moving away from offering its retail-only spot trading platform to foray into other services. With institutional interest on the rise, which has been accentuated by CME futures volumes and the overall sentiment, Kraken is likely taking a step in the right direction.
Crypto Firms Growing
These acquisitions aren’t the only signs that the “crypto winter” of 2018 and early-2019 is finally over. Another one of these signs is the growth in the product rosters of industry firms.
Just recently, Blockchain.com, presumably leveraging the aforementioned acquisition of RTBTC, launched its own cryptocurrency exchange.
Called “The PIT”, this new exchange promises to be much faster than Coinbase and other competitors and more liquid than similar platforms. As reported by Blockonomi, the firm wrote in their Tuesday announcement:
“We built an all-star team of veterans from NYSE, TD Ameritrade, Google, Goldman Sachs, UBS, Interactive Brokers, and Revolut, to build it from the ground-up […] And what we delivered is not only the fastest in crypto by an order of magnitude – we measure in microseconds, not milliseconds – but a matching engine that could go head-to-head against any machine engine in the entire world.”
Although these are lofty promises for a platform that has just launched, Blockchain.com brings on over 40 million wallet users, who likely hold hundreds of millions of dollars worth of cryptocurrency.
Crypto startups have also bagged a number of large partnerships and investments, showing that investors and corporations alike are beginning to see the potential of this industry.