Cryptocurrency exchange Coinbase’s custody solution, Coinbase Custody, has acquired crypto asset storage company Xapo’s institutional business. With the Xapo acquisition, Coinbase will become the most popular custody solutions for institutions with more than $7 billion in assets under custody.
Through the acquisition of Xapo’s institutional businesses, we’re now proud to act not only as the gateway for millions of people to cryptocurrency, but also as the world’s largest and most trusted steward of digital assets. Xapo has been a tremendous flagbearer for Bitcoin and the economic equality it can offer to billions across the globe. We’re honored to carry this flag onward.Coinbase Blog
According to Fortune, Coinbase paid $55 million for the Xapo acquisition. The report states that Coinbase wants to use this acquisition to move beyond its core trading business towards custody and possibly even lending.
In its official blog, Xapo mentioned a shift in focus towards its consumer business as one of the reasons behind this move.
Today, we don’t charge our clients anything to hold their coins in custody and service them. It is getting expensive to support this business, especially the insurance and minimum capital requirement. However, without providing additional features and service, we felt it wouldn’t be fair to start charging our clients a fee. We believe that in choosing Coinbase, the Institutional Custody Business is going to a company that can provide great insurance, borrowing and investment alternatives that we are not offering.Xapo blog
(Image Credit: Coinbase blog)