Hunts for Funds: Bitstamp Plans Derivatives Trading Launch

Hunts for Funds: Bitstamp Plans Derivatives Trading Launch

Time Stamp: August 8, 2023 7:51 AM
Source Node: 2810002

One of the
oldest cryptocurrency exchanges, Bitstamp, plans to rebuild its position and seeks
new investors. The information was confirmed by its CEO, Jean-Baptiste
Graftieaux, who revealed that the funds would be used to launch derivatives trading in Europe and expand operations in the UK and Asian markets.

In a
conversation with Bloomberg, Graftieaux denied that the platform, which has
been operating for over 12 years, is looking for a buyer. The company is not
for sale, and its management aims to gather additional funding by attracting a
strategic investor. This would accelerate its current growth and introduce new
products and services to an expanding base of institutional and retail
customers. Fundraising began two months ago, with Galaxy Digital Holdings
participating as an advisor.

It is worth
noting that the European-based Bitstamp was once one of the largest
cryptocurrency exchanges, competing with the now-defunct Mt. Gox. Since then,
the significance of the exchange has diminished, but it still ranks among the
top ten cryptocurrency entities in terms of volume. In the last 24 hours,
turnover on the platform exceeded $133 million. For comparison, the turnover on
the top-ranking exchange, Binance, was nearly $7 billion, and on Coinbase, it
was just under $900 million.

Since 2018,
Bitstamp has been owned by NHMH, a European investment company that belongs to
NCX, an Asian trading conglomerate. This year, another crypto company Pantera
decided to sell its minority shares in Bitstamp, which Ripple acquired.

Bitstamp Gains Market
Share in the US

According
to data from Kaiko, Bitstamp’s US branch, which holds a BitLicense issued by
New York State, has gained market share locally this year. Meanwhile, other
popular platforms, such as Binance US, have lost their significance, partly due
to regulatory issues and lawsuits.

Based on
June data, Binance US’s market share has dropped from 8.2% to just 1.5% due to
the ongoing legal battle with the Securities and Exchange Commission (SEC ).
Coinbase remains the biggest player in the US market, accounting for over 50%
of all transactions.

However,
due to Binance US’s decline, the US branch of Bitstamp, along with exchanges
like Kraken and LMAX, began to benefit.

More Exchanges Introducing
Derivatives Trading

As
mentioned above, Bitstamp plans to use the funds raised to expand its European
derivatives trading offerings. This move is not isolated, as more cryptocurrency
exchanges are opting for a similar solution.

FTX
dominated the crypto derivatives market, but the exchange collapsed in November
of the previous year. Other exchanges, including Binance, Coinbase, and Gemini,
have since aimed to capture a portion of that lucrative market segment. For
them, this also indirectly addresses regulatory pressures in the US, as
derivative trading is offered through branches registered outside the United
States.

Now, Bitstamp
also has plans to launch a similar service, but it all depends on whether the
exchange can secure a strategic investor.

One of the
oldest cryptocurrency exchanges, Bitstamp, plans to rebuild its position and seeks
new investors. The information was confirmed by its CEO, Jean-Baptiste
Graftieaux, who revealed that the funds would be used to launch derivatives trading in Europe and expand operations in the UK and Asian markets.

In a
conversation with Bloomberg, Graftieaux denied that the platform, which has
been operating for over 12 years, is looking for a buyer. The company is not
for sale, and its management aims to gather additional funding by attracting a
strategic investor. This would accelerate its current growth and introduce new
products and services to an expanding base of institutional and retail
customers. Fundraising began two months ago, with Galaxy Digital Holdings
participating as an advisor.

It is worth
noting that the European-based Bitstamp was once one of the largest
cryptocurrency exchanges, competing with the now-defunct Mt. Gox. Since then,
the significance of the exchange has diminished, but it still ranks among the
top ten cryptocurrency entities in terms of volume. In the last 24 hours,
turnover on the platform exceeded $133 million. For comparison, the turnover on
the top-ranking exchange, Binance, was nearly $7 billion, and on Coinbase, it
was just under $900 million.

Since 2018,
Bitstamp has been owned by NHMH, a European investment company that belongs to
NCX, an Asian trading conglomerate. This year, another crypto company Pantera
decided to sell its minority shares in Bitstamp, which Ripple acquired.

Bitstamp Gains Market
Share in the US

According
to data from Kaiko, Bitstamp’s US branch, which holds a BitLicense issued by
New York State, has gained market share locally this year. Meanwhile, other
popular platforms, such as Binance US, have lost their significance, partly due
to regulatory issues and lawsuits.

Based on
June data, Binance US’s market share has dropped from 8.2% to just 1.5% due to
the ongoing legal battle with the Securities and Exchange Commission (SEC ).
Coinbase remains the biggest player in the US market, accounting for over 50%
of all transactions.

However,
due to Binance US’s decline, the US branch of Bitstamp, along with exchanges
like Kraken and LMAX, began to benefit.

More Exchanges Introducing
Derivatives Trading

As
mentioned above, Bitstamp plans to use the funds raised to expand its European
derivatives trading offerings. This move is not isolated, as more cryptocurrency
exchanges are opting for a similar solution.

FTX
dominated the crypto derivatives market, but the exchange collapsed in November
of the previous year. Other exchanges, including Binance, Coinbase, and Gemini,
have since aimed to capture a portion of that lucrative market segment. For
them, this also indirectly addresses regulatory pressures in the US, as
derivative trading is offered through branches registered outside the United
States.

Now, Bitstamp
also has plans to launch a similar service, but it all depends on whether the
exchange can secure a strategic investor.

Time Stamp:

More from Finance Magnates