Crypto Exchange FTX to Expand in Asia, Acquires Japanese Rival Liquid

Sophie Webster, Tech Times 02 February 2022, 05:02 pm

FTX, the cryptocurrency exchange owned by Sam Bankman-Fried, is reportedly acquiring its Japanese rival Liquid. The total amount of the acquisition is undisclosed.

FTX to Acquire Liquid

On Tuesday, Feb. 2, the cryptocurrency exchange company said that it had agreed to buy Liquid and all of its operating subsidiaries, including its Singapore-based unit and Quoine Corporation.

Quoine Corporation was one of the first cryptocurrency exchanges to register with Japan's Financial Services Agency back in 2017.

FTX stated that it expects the acquisition of Liquid to happen by March 2022. The deal is still subject to regulatory and shareholder approval.

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Liquid said in a statement that following FTX's acquisition of the company, Quoine would eventually integrate FTX's products and services into its offering. The existing Japanese customers of FTX will be migrated to Quoine's platform.

Liquid added that in connection with the acquisition, FTX has also entered into an agreement with Liquid to give its existing Japanese customers services in compliance with Japanese laws and transfer the existing users to Quoine.

FTX is expanding in the Asian cryptocurrency market as the competition in the market is heating up. The cryptocurrency exchange had raised $400 million at a $32 billion valuation.

Bankman-Fried told CNBC that a large focus for the firm was buying licenses in several countries.

Traditional lenders like Singapore's DBS and Japan's SBI have been making moves in the space to capitalize on crypto's growth.

SBI is a minority shareholder in several crypto start-ups, including the $15 billion company Ripple. On the other hand, DBS has set up its own digital asset exchange.

Liquid was founded in 2014, and it is one of the largest crypto exchanges in the world, with almost $72 million in daily trading volumes.

According to CoinMarketCap data, Liquid offers spot trading in digital currencies like ether, bitcoin, and XRP and financial derivatives, allowing investors to speculate on price movements.

FTX and Liquid's Value

Last year, the Japanese company suffered a hack, which saw the cybercriminals make off with more than $90 million worth of cryptocurrency.

After the unfortunate attack, FTX lent $120 million to Liquid in the form of debt financing. Liquid stated that the funds would be used to strengthen the company's capital position and that the two firms would pursue collaborative opportunities.

FTX offers crypto spot trading and derivatives products in several countries around the world, except for the United States, where its affiliate, FTX we, provides its services.

Last week, FTX US said that it had raised $400 million in its first external fundraise. The cryptocurrency exchange is currently valued at $8 billion, according to Coin Desk.

FTX's investors include the Ontario Teachers' Pension Plan Board, Temasek, and SoftBank's Vision Fund 2. The fundraiser shows that investors are confident in the digital assent industry, even as the prices of bitcoins and other tokens have fallen.

Bitcoin and ether, two of the biggest virtual currencies globally, have halved in value since reaching high numbers in November. Meanwhile, smaller tokens like Cardano and Solana have suffered even steeper declines.

In June 2021, FTX made Tom Brady and Gisele Bundchen ambassadors but did not give the equity stake amount.

In August 2021, FTX became the sponsor of "League of Legends."