Kraken, the largest cryptocurrency exchange in Europe, has acquired Dutch Bitcoin exchange CleverCoin, further consolidating its dominance in the region, and also anticipating increased demand amid Brexit-induced uncertainty.
It is the third digital currency exchange Kraken has swallowed this year; less than six months ago it acquired both Coinsetter and Cavirtex in a landmark deal.
The addition of CleverCoin cements Kraken's position as the undisputed leading exchange in Europe with the arrival of thousands of new clients, said a statement. Terms of the deal were not announced. San Francisco-based Kraken was founded back in 2011 and was the first Bitcoin exchange to have its market data displayed on the Bloomberg Terminal.
Kraken CEO Jesse Powell said he plans to fold the CleverCoin brand into Kraken's global umbrella while providing existing clients with seamless access to Kraken's suite of features. CleverCoin clients will be automatically transferred to Kraken's platform on June 29, 2016. Once the transfer is completed, account holders will be directed toKraken's website to login, update account information, and can begin trading immediately.
Powell said in a statement: "In record time, the digital currency industry has matured. Our M&A plans have been accelerated by encouraging news throughout the industry. Prices are rising, the regulatory picture is rapidly clarifying, and clients from around the globe are joining us in record numbers. The acquisition of CleverCoin will empower Kraken with greater liquidity and a significantly expanded customer base in Europe, our flagship market."
Since the majority of CleverCoin clients are in European countries, the acquisition is expected to have the greatest impact on Kraken's euro trading pairs. Average weekly volume in these pairs has already been growing at a rapid rate since the third week of April, with an over 4x increase in the bitcoin-euro (XBT/EUR) and ether-euro (ETH/EUR) pairs. The ether-bitcoin pair (ETH/XBT) has seen a massive 9x increase.
In the weeks following Kraken's acquisition of Coinsetter and Cavirtex on January 19th, Kraken saw big gains in average weekly trade volumes, including XBT/USD (13x increase), ETH/USD (30x increase), XBT/CAD (50x increase), and ETH/CAD (6x increase).
Kraken's M&A appetite was bolstered in February when SBI Investment, an influential Japanese venture fund, led a Series B round of financing. In April, Kraken announced an additional, significant investment from leading Japanese FX brokerage Money Partners Group to their Series B. Also this year Kraken was selected by CME Group to be a key supplier of market data for new reference and real-time bitcoin price indices. Kraken also recently unveiled the first-ever Ether Dark Pool and the addition of leveraged trading for ether with multiple currency pairs.
Eindhoven-based CleverCoin is a graduate of Boost VC, the high profile accelerator backed by venture capitalists Tim and Adam Draper. CleverCoin was one of the earliest exchanges in Western Europe to focus on compliance, offer leveraged trading, and establish regulated banking partnerships.
CleverCoin CTO and co-founder Karsten Nilsen said, "Kraken is the ideal custodian for CleverCoin going forwards. They are, by every measure, the largest Bitcoin and digital asset exchange in Europe and our core beliefs are perfectly aligned. As of today, CleverCoin clients will have seamless access to all the features and benefits of Kraken's global brand, including the ability to trade many of the most popular currency pairs, the latest technology, the most advanced security, and faster Single Euro Payments Area (SEPA) transfers."