Cryptocurrency exchange FTX is raising capital in parallel with a potential acquisition, according to a person familiar with the matter.
It’s evaluating several possible takeover candidates, some of which are companies operating retail-trading platforms, the person said. Negotiations are in preliminary stages. If acquisition talks fall through, it’s less likely FTX will raise money, according to the person.
FTX is seeking the same $32 billion valuation it was assigned the last time it raised money early this year if it does a capital raise, the person said. That stands out given the subsequent rout in crypto prices; FTX rival Coinbase (COIN) has seen its stock plummet about 70% this year.
A takeover of a company focused on retail investors would likely bring an influx of new users to FTX, which has mostly served sophisticated traders and professionals. It has already taken steps into retail, launching its own equities trading product, FTX Stocks, earlier this year for customers in the U.S.
UPDATE (Sept. 14, 2022, at 20:16 UTC): Adds Robinhood's stock price reaction.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.