San Francisco-based cryptocurrency exchange Coinbase has announced t is acquiring crypto prime broker Tagomi, which focuses on servicing institutional investors.
The companies did not disclose the price of the acquisition, but a source familiar with the deal revealed Coinbase paid entirely with its privately-held stock. The source added that media reports in November claiming Tagomi was being sold for $150 million overstated the value.
According to Fortune, a source familiar with Tagomi revealed the price was “close to $100 million,” and added the San Francisco-based firm outbid leading cryptocurrency exchange Binance to acquire Tagomi.
Tagomi was launched in December 2018, and gained attention in the cryptocurrency space for the veterans of the traditional financial world in its executive team. These included Goldman Sachs’ former head of electronic trading Greg Tusar and Union Square Ventures partner Jennifer Campbell. Tagomi’s financial backers include billionaire tech mogul Peter Thiel.
Tagomi’s focus on institutional investors gave large traders additional options in the space, as before they had to rely on over-the-counter trading desks for large transactions. In its announcement, Coinbase noted the acquisition will allow it to better serve institutional investors. It reads:
The addition of Tagomi will round out our product suite for the fast-growing institutional trading market. It will allow us to offer custody, professional trading features, and prime brokerage services on one platform, giving sophisticated investors the seamless, powerful trading experience they have come to expect in equities and FX markets.
Fortune reports Emilie Choi, Coinbase’s chief operating officer, noted Tagomi will initially operate as a stand-alone brand. Over time, however, it will likely be integrated into Coinbase Pro, Coinbase’s platform for professional traders.
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