Kraken Exchange Buys Crypto Futures Startup for Over $100 million

Kraken exchange cryptocurrencies startup Crypto Facilities crypto futures

Leading cryptocurrency exchange Kraken has announced the acquisition of Crypto Facilities, a startup offering regulated crypto futures in Europe.

The deal, for an undisclosed fee thought to be in excess of over $100 million, marks the largest acquisition in the sector this year. The tie-up will allow Kraken customers to access crypto futures through a single trading interface, providing new product options for crypto investors on the Kraken platform.

The takeover also allows Kraken to bypass the licensing application process, giving access to European markets on a regulated footing without having to independently secure the required licenses — a process that can take several years to complete.

According to CEO Jesse Powell, the move will help “massively accelerate” the growth of the exchange in the region, by taking advantage of the UK Financial Conduct Authority license held by Crypto Facilities.

The FCA has also approved the deal, giving Kraken the green light to benefit from the license as intended once the acquisition is concluded.

Powell said the deal allows Kraken to offer more assets for customers, as well as expanding its developer team.

“The deal brings our total developer team to over 100, and will accelerate Crypto Facilities by enabling us to add more assets. We plan to launch more contracts in the medium term and Kraken also has plans to launch more assets.”

The team of 25 developers at Crypto Facilities will move to Kraken as part of the deal, including CEO Tim Schlaefer, who will continue to head up Crypto Facilities as an independent company in the Kraken group.

Powell said the acquisition confirmed Kraken as the only regulator platform for crypto derivatives in Europe.

“Right now there isn’t anything else. In Europe, we are the only regulated platform for derivatives and we’re not aware of anything in the pipeline.”

The acquisition comes amid what some have described as the “crypto winter,” with prices for cryptocurrencies like bitcoin still substantially down since 2018 amid the ongoing bear market.

Kraken’s expansion reflects the trend of crypto companies toward building and developing partnerships with other firms, in preparation for expanding into the next bull market.