Bahamas-based FTX Exchange, one of the world’s largest cryptocurrency companies, plans to officially launch its business in Canada by acquiring Bitvo Inc., a Calgary-based cryptoexchange that is regulated by all 13 provincial and territorial securities commissions across the country.
The move by FTX comes amid severe industry volatility, as cryptocurrencies continue to plunge to multiyear lows. Several crypto companies, such as Coinbase Global Inc., are making deep cuts to their work force. Crypto lender Celsius Network Ltd. has halted operations indefinitely – leaving millions of its customers in limbo, and accelerating a global route for crypto.
Neither FTX or Bitvo would reveal the exact terms or valuation for the acquisition, which is expected to close in the third quarter this year pending regulatory approval. Chief executives at both companies said users for their individual crypto platforms will see no changes in the short term, but the platforms will pick up some features from one another and offer them to users as a whole in the coming months. Staffing levels are not expected to be affected by the deal, the companies said.
“This definitely comes at an interesting time for crypto. But to us, it speaks to FTX’s level of commitment to this sector in the long term. It shows they are continuing to advance unwaveringly in the face of these market tumbles,” Pamela Draper, CEO of Bitvo, told The Globe and Mail.
On Thursday, bitcoin continued its deep downturn, shaving off 30 per cent of its price in a single week, hovering just above US$20,000. Bitcoin had peaked out in November last year at US$68,000 and has since fallen by nearly 70 per cent. Other cryptocurrencies also plunged Thursday, with ether dropping down to US$1,100, which is 10 per cent lower than the day before and its lowest price in more than two years.
Sam Bankman-Fried, CEO of FTX, said those tumble don’t scare him, however: “Markets are going to do what markets are always going to do.”
“We’re focused and really excited to be building a real Canadian footprint, especially by working together with a registered platform,” Mr. Bankman-Fried said in an interview. “In particular, we’ve had some fantastic conversations with the government of Alberta, which has been really constructive and is trying to take the lead in Canada and around the world for crypto policy and frameworks.”
In a statement to The Globe, Alberta Jobs Minister Doug Schweitzer hailed FTX’s launch, despite the current free fall for tokens and digital assets. Earlier this year, Mr. Schweitzer had said companies operating in the crypto space were quick to demonstrate “immense interest” in the province after the Alberta government’s promise in its Throne Speech that it would make the province a global leader and hub for crypto.
“FTX launching in Calgary will help further grow our reputation and our opportunities in technology and innovation, specifically in blockchain technology,” Mr. Schweitzer said Thursday.
Beyond Alberta, Mr. Bankman-Fried said FTX is also eyeing other moves in Canada. “For now, we don’t have any specific plans in mind, but as we’ve said before, we’re looking to expand in places where regulators are working with the sector to create meaningful opportunities,” he said.
Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. sign up today.