$4.1 Billion Crypto Transaction Surge Will Soon Become “Much More Significant,” Says Crypto Fund Founder – DL News

The cryptocurrency industry has never really experienced a crazy deal phase, and larger companies have historically preferred to acquire tokens that are already on the market.

That’s changing, says Dan Tapiero, CEO and chief investment officer of 10T Holdings, a $1.4 billion fund investing in digital asset companies.

The industry’s $4.1 billion in deals to date – most recently capped by Robinhood Markets’ $200 million acquisition of Bitstamp – are just the beginning.

“We will see a lot more of this and probably a lot more substance; $200 million is a very low figure,” Tapiero said DL News.

Tapiero said exchanges are the easiest offering for traditional companies.

“Traditional financial exchanges should purchase or merge with larger, global exchanges,” he said. “There are at least 10-15 decent quality exchanges.”

Tapiero said the industry is seeing renewed interest this year – evidenced by the rapid acquisition of Robinhod – thanks to the January approval of Bitcoin exchange-traded funds issued by Wall Street heavyweights BlackRock and Fidelity Investments.

“It really woke people up,” he said. “Even six months ago, people thought this space would just disappear, then we created the ETF.”

Indeed, the last six months have already been marked by smaller acquisitions in the industry.

In February, Tools for Humanity, the company developing the controversial iris-scanning crypto project Worldcoin, acquired the wallet provider and engineering team for an undisclosed amount.

In March, Marathon Digital, one of the largest Bitcoin mining companies in the industry, announced that it had acquired another Bitcoin mine in Texas, adding 200 megawatts of mining capacity.

“I have never been able to buy things at such low prices.”

— Dan Tapiero, CEO and CIO of 10T Holdings

said Consensys CEO Joe Lubin DL News in May that his blockchain company was working on an acquisition in the cryptocurrency security sector.

In June, Polygon bought another zero-knowledge technology company called Toposware.

Tapiero said Consensys – which counts stablecoin issuer Circle and cryptocurrency exchange Kraken among its portfolio companies that expect public listings – has just closed a new fund and is now looking to invest as well.

“I have never been able to buy things at such low prices,” he said.

“We never had those deals because the pitch was more crowded.”

A three-year Crypto shock

The increase in deal chatter comes at a time when Bitcoin is hitting record highs, but traditional investors are still wary of entering the cryptocurrency market due to its notorious volatility and sky-high valuations.

The last three years have been no exception.

Celsius Network achieved a valuation of $3 billion in 2021 and counted Caisse de Depot, Canada’s second-largest pension fund, as an investor. A year later, the cryptocurrency lender filed for bankruptcy.

Cryptocurrency exchange FTX, which was valued at $32 billion in January 2022, collapsed seven months later, leaving an $8 billion hole in its balance sheet.

In March, FTX founder Sam Bankman-Fried was sentenced to 25 years in prison for fraud.

Liam Kelly lives in Berlin DL News correspondent. Contact him at [email protected].