Author – Sam
Fintech startup Circle Internet Financial Ltd reported it acquired Cryptocurrency Exchange Poloniex the 14th largest crypto exchange by 24 hours trade volume. The acquisition makes it a close rival for the Coinbase one of the largest crypto exchange in the world. Cryptocurrency exchanges have been growing rapidly, thanks to the Bitcoin hype and the 2017 crypto gains.
The Circle mobile app allows people to send and receive money instantly. It also operates a Circle Desk –a trading desk that handles over $2 billion worth of crypto transaction monthly with the least transaction size of $250,000. Currently, Circle is working on a mobile version that will enable people to easily join the digital currency world.
The Acquisition Deal
The terms of the acquisition have not been disclosed, but Fortune magazine reported the deal was worth over $400 million, citing an unnamed source familiar with the deal. Founded in 2014, Poloniex is currently available in over 100 countries.
Circle over the years has received funding from top leading firms such as Goldman Sachs, Baidu and other. The Poloniex acquisition by Circle is currently the highest in the volatile crypto exchange market. Goldman Sachs stake in the crypto market appears odd to many of the firms CEO Lloyd Blankfein sometimes makes bad comments on digital currencies.
According to a Bloomberg report, Circle co-founders Sean Neville and Jeremy Allaire stated that they intend to grow the Poloniex platform beyond its current incarnation as an exchange for only crypto assets. They further said that they envision a robust multi-sided distributed marketplace that can host tokens which represent everything of value. Circle hopes to increase the exchange’s crypto listings and connection to the dollar, euro, and pound, which is currently offered through the Circle trading desk.
This comes as Bank of America recently admitted Cryptocurrencies pose a risk to its market model. Such reports show that financial institutions are taking note of the disruptive nature of the crypto market and firms are becoming comfortable dealing indirectly with firms in the cryptocurrency supply chain.
South Korea, the third largest marketplace for cryptocurrencies shows the indirect crypto dealing model in action. Upbit currently one of the largest cryptocurrency exchange platforms was formed this year by a subsidiary of Kakao an internet company. In Japanese, Line, the Japanese messaging platform filed for an application to establish its own cryptocurrency exchange.
Coinbase Emerging Rivals
Circle acquisition of Poloniex gives it the customer base and revenue to tackle a rival industry giant, Coinbase. Circle Internet Financial Ltd is not the only in the race to be Coinbase rival as Robinhood, bitFlyer and Canada-based cryptocurrency trading platform Coinsquare, are all seeking to increase their customer and financial power to increase their global market share.
Author: Author : Mike
A avid crypto expert. Freelancer, editor and manage part time content at cryptonewsbytes.com. Working at cryptonewsbytes.com since Dec 2017.
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