San Francisco-based digital currency exchange Kraken is making yet another acquisition, scooping up Dutch exchange CleverCoin.
The deal is Kraken’s second acquisition of 2016, coming just over five months after it purchased New York-based Coinsetter, which had acquired Canadian bitcoin exchange CAVirtex the year before.
The integration of CleverCoin’s services and its customer base into Kraken’s platform is set to take place this Wednesday on 29th June. The terms of the deal were not disclosed.
While Kraken is acquiring the assets and customer base of CleverCoin, the team behind the exchange isn't carrying over to the new owners.
When reached for comment, CleverCoin CEO Karsten Nilsen said that he and co-founder Christian de Kok wouldn't be joining Kraken as part of the deal, and will move on to another business focused on enterprise IT.
Founded in early 2014, CleverCoin spent that year expanding its services to move past its initial market in The Netherlands, looking to capture greater market share in Europe.
Kraken CEO Jesse Powell said that the deal was buoyed by what he described as a brightening outlook for digital currencies, pointing to recent price increases and clarification on regulatory questions as key drivers.
He said in a statement:
"The acquisition of CleverCoin will empower Kraken with greater liquidity and a significantly expanded customer base in Europe, our flagship market."
Blog posts on CleverCoin’s website suggest that the acquisition was motivated, at least in part, by past issues with a payment processor they were using.
On 15th April, the exchange announced that it had stopped processing orders, and later that month it was still working on the problem. Earlier this month, the company said that it had “found a solution” and would make further details known on 28th June – the date of today’s announcement.
Nilsen referenced the processor issues in an email to CoinDesk, while also highlighting the existing relationship between the two exchanges.
"We have known the Kraken team since being at [startup accelerator] Boost VC, lately we lost one of the biggest payment providers we were working with and we started talking and managed to come up with a great deal together," he told CoinDesk.
Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in Kraken.
Acquisition image via Shutterstock