Crypto Exchange Coinbase Buys Broker-Dealers in a Move to Offer Regulated Securities
Coinbase, a digital currency exchange headquartered in San Francisco, has acquired broker-dealer Keystone Capital Corp in a bid to operate as a regulated broker-dealer, pending approval by federal authorities.
Coinbase, a $1.6 billion digital currency exchange headquartered in San Francisco, has acquired broker-dealer Keystone Capital Corp in a bid to operate as a regulated broker-dealer, pending approval by federal authorities.
The company also announced that it has acquired Venovate Marketplace Inc. and Digital Wealth LLC. Venovate is registered as a broker-dealer and is licensed to operate as an alternative trading system, while Digital Wealth holds an RIA license. The terms were not disclosed.
“If approved, Coinbase will soon be capable of offering blockchain-based securities, under the oversight of the Securities and Exchange Commission and the Financial Industry Regulatory Authority,” said President and Chief Operating Officer Asiff Hirji in a company blog post. “This step forward is being made possible by our acquisition of a broker-dealer license, an alternative trading system license, and a registered investment advisor license.”
Hiriji said that securing these licenses will bring the company one step closer to its goal of offering customers a platform to buy, sell, and use many different types of crypto assets.
“Ultimately, we can envision a world where we may even work with regulators to tokenize existing types of securities, bringing to this space the benefits of cryptocurrency-based markets — like 24/7 trading, real-time settlement, and chain-of-title,” said Hiriji. “We believe this will democratize access to capital markets for companies and investors alike, lowering costs for all participants and bringing additional transparency and inclusion to the ecosystem.”
Coinbase is the largest cryptocurrency exchange in the U.S. and currently offers four types of virtual currency, including Bitcoin, Bitcoin Cash, Litecoin, and Ethereum.
