In a move that signal’s consolidation in the sector, Kraken revealed yesterday that it is acquiring two of the oldest exchanges in the bitcoin ecosystem, Coinsetter and its subsidiary Cavirtex, as the exchange operator expands in the important US and Canadian bitcoin markets, respectively.
Founded in 2012 in New York City, Coinsetter is one of America’s prominent national bitcoin exchanges. Cavirtex, founded in 2011 and acquired by Coinsetter in April 2014, is Canada’s first bitcoin exchange and has the largest historical trading volume in the country.
Kraken, which claims to be the largest bitcoin exchange in Euro volume and liquidity, will fully absorb both Coinsetter and Cavirtex brands in the acquisition. Client accounts of both exchanges will be automatically transferred to Kraken’s platform on January 26, 2016. Once the transfer is completed, account holders will be directed to the Kraken website to login and update account information if needed, and will be able to trade immediately, according to the San Francisco-based exchange operator.
Kraken also announced a partnership with American payment provider SynapsePay to permit “rapid, low-fee” domestic USD deposits and withdrawals to individual and institutional clients in 37 US states and Washington, DC. Most Americans will for the first time have access to Kraken’s full suite of exchange services including bitcoin-dollar trading.
Through Kraken’s continuing partnership with Canadian payments provider Vogogo, Canadians will be able to deposit and withdraw funds to the exchange.
Outbound Coinsetter CEO Jaron Lukasiewicz commented:
I’m excited what our acquisition by Kraken means for Coinsetter and Cavirtex customers, who will all benefit from Kraken’s leading platform, global team and unparalleled customer service. For years, the teams at Coinsetter and Cavirtex have worked closely with traders, bitcoin companies and investors to advance the burgeoning bitcoin space in North America. We are confident that Kraken is the right world-class company with the resources, vision and drive to successfully carry our torch far into the future.
Previously, Kraken had focused on developing market share outside of the US, particularly in Europe. Kraken CEO Jesse Powell commented on how the acquisition fit into the company’s plan for 2016:
The acquisition of Coinsetter and Cavirtex marks the beginning of a new era for Kraken. The consolidation of these three veteran giants is the largest exchange deal to date. Combined, we represent over thirteen years of bitcoin exchange experience in an industry that is only seven years old. Kraken has big, exciting plans for 2016. This year we will fully leverage what we’ve built as the world’s most trusted and secure bitcoin exchange. This is the year that we make long strides to capture key markets and crank up the volume. This is the year of the Kraken.
To celebrate its acquisition, Kraken will offer all American and Canadian clients, including Canadians living abroad, free deposits on its exchange through March 1, 2016.
In addition to Euros, Kraken’s customers can also trade US dollars, Canadian dollars, British pounds, Japanese yen and other digital currencies..
Founded in 2011, Kraken was the first bitcoin exchange to have its data displayed on the Bloomberg Terminal and one of the first exchanges to offer leveraged bitcoin margin trading. Kraken was also rated one the top bitcoin exchanges by BitReview last year, appointed by a Tokyo court as trustee in the Mt. Gox bankruptcy, and is a partner of Germany’s regulated online banking platform Fidor Bank.
Kraken is backed by investors including Hummingbird Ventures, Blockchain Capital, and Barry Silbert’s Digital Currency Group, among others. Before its acquisition, Coinsetter has its lifetime raised approximately $3 million in venture capital from four different investors, including Silbert, Blockchain Capital, Cryptonaut Ventures, and Tribeca Venture Partners.