Coinbase, the giant cryptocurrency exchange, has acquired One River Digital Asset Management to broaden its offerings beyond retail customers.
As a result of the acquisition, One River Digital Asset Management will be rebranded as Coinbase Asset Management, according to a blog post by the company.
According to the blog post which was sighted by Investors King, Coinbase noted that the new asset management firm will be run as an “independent business and a wholly owned subsidiary”.
The blog post partially read, “Coinbase and ORDAM share an ethos grounded in prudent risk management, a trait which has enabled both firms to successfully navigate the recent market turmoil”.
Although Coinbase and One River Digital Asset Management have an established relationship, the details of the acquisition are however sketchy as of the time of writing this report.
Investors King learnt that Coinbase has been looking to expand beyond its core retail trading business in response to the drop-off in transaction volume in recent months, thereby institutional investment management forms a part of that strategy.
Speaking on the development, Coinbase’s head of institutional product, Greg Tusar said ‘This is about wanting to bring more institutional capital into the world of crypto. We expect to build on the other side of this crypto winter, an awesome asset-management business.”
The new Asset Management Arm of Coinbase, which will operate as an independent unit, will be helmed by CEO and Chief Investment Officer Eric Peters, who is also CEO and CIO of One River Asset Management.
About Coinbase and Institutional Trading
Early this year, Coinbase claimed its platform already supports $130 billion of quarterly institutional trading volume and has $50 billion in institutional assets. It noted that at the end of 2022, around a quarter of the 100 largest hedge funds globally used Coinbase.
In August last year, BlackRock enabled crypto access through a Coinbase integration. And it has a relationship with TradFi technology firm Broadridge.
As recent surveys suggest a growing institutional interest in digital assets, Coinbase’s recent acquisition could be a masterstroke to expand its horizon.