NEW YORK, Jan 19 (Reuters) - Global bitcoin exchange Kraken said on Tuesday it is acquiring digital currency exchanges Coinsetter and Cavirtex, strengthening its expansion in North America.
Terms of the acquisition were not disclosed.
San Francisco-based Kraken, the world’s largest bitcoin exchange as measured in euro volume and liquidity, will fully absorb the Coinsetter and Cavirtex brands, it said in a statement.
New York-based Coinsetter was founded in 2012 and targeted institutional clients. In April last year, it acquired Cavirtex, Canada’s first bitcoin exchange.
“Coinsetter has a lot of synergies with us and it’s pretty clean,” Kraken Chief Executive Officer Jesse Powell said in an interview with Reuters.
“There’s a lot of companies that you can do a deal with. But Coinsetter has certainly a cautious approach to the United States and it doesn’t have contingent liabilities hanging around its head and that’s pretty appealing to us.”
Client accounts of both Coinsetter and Cavirtex will be automatically transferred to Kraken’s platform on Jan. 26, the company statement said.
For strategic reasons, including a cautious approach to compliance, Kraken had previously focused on developing market share outside the United States, especially Europe. Kraken’s average bitcoin/euro trading volume is 5,000 to 7,000 bitcoins per day.
Its bitcoin/dollar volume, however, is only one-tenth of its European turnover, Powell said, and with the acquisition, Kraken hopes to double that.
Powell said Kraken is taking two of Coinsetter’s employees, while the latter’s chief executive officer and founder, Jaron Lukasiewicz, will stay temporarily as an adviser before moving to other projects.
“I’ve always thought that there are just too many businesses for the current price of bitcoin,” Powell said. “There are just too many exchanges out there. If we put our businesses together, we may have a better shot.”
Bitcoin on Tuesday last traded at $385, down 0.1 percent.
Editing by Matthew Lewis