Nasdaq-listed crypto exchange Coinbase agreed to acquire Dubai-based crypto options exchange Deribit in a transaction valued at USD 2.9 bn in a move to expand its derivative business, according to a joint statement. The agreement is expected to close by year end, pending regulatory approvals. There’s no publicly available information about the banks that advised on the transaction.

The details: Deribit selling shareholders will receive USD 700 mn in cash and 11 mn shares of Coinbase Class A common stock, subject to customary purchase price adjustments, the statement reads. Derbit’s founders will step down from their roles and exit the company following the closing of the transaction, according to a separate statement.

Crypto options boom? The acquisition will allow Coinbase to offer traders a bigger suite of trading products, including spot, futures, perpetual futures, and options, ahead of what it says could be an expansion similar to the equity options boom of the 1990s.

The acquisition is also expected to ramp up profitability for Coinbase and bring more diversity and stability to its trading revenues, according to the statement. Unlike spot trading, options trading tends to be less cyclical, as traders use options to manage risk in both rising and falling markets, the statement reads.

About Deribit: The company relocated to the UAE in April 2024, and has around USD 30 bn of outstanding trading contracts, making it the world's largest crypto options trading exchange, the statement said. Deribit also handled over USD 1 tn in trading volume last year.

Market reax: The share price of Coinbase declined 3.5% to USD 199.32 apiece on Thursday’s close.

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