Ripple Becomes a Stakeholder in Bitstamp: Details
- American technology firm Ripple acquired a stake in European crypto exchange Bitstamp in the first quarter of 2023.
- The stake purchased was held by the hedge fund Pantera Capital, which was an early investor in Bitstamp.
- An investment firm headed by Mike Novogratz, Galaxy Digital, was responsible for advising Ripple through the deal.
- The amount that the San Francisco-based firm paid for the acquisition of Pantera’s stake remains unclear.
- The firm also announced the acquisition of Metaco and its plans to provide custody solutions for tokenized assets.
Blockchain payments company Ripple has been under a lot of scrutiny over its native token, XRP, being a security. However, the firm remains defiant and continues to push back and fight the authorities in the United States. However, it is crucial to note that the company has confirmed the acquisition of the stake held by Pantera Capital, an American hedge fund that is focused on cryptocurrencies but was founded in 2003 by Dan Morehead, in the European cryptocurrency exchange Bitstamp.
As per a transcript of a Galaxy shareholder conference call in early May, Ripple acquired a stake in Bitstamp in the first quarter of 2023, while the investment firm headed by Mike Novogratz, Galaxy Digital, was responsible for advising the blockchain payments company in the deal. The stake belonged to Pantera Capital, which had invested in Bitstamp during its initial days.
“More broadly in our global markets business, on the back of a record year for our investment banking team, we advised Pantera, a leading blockchain asset management firm, on the sale of its stake in European digital asset exchange Bitstamp to Ripple Labs in Q1,” said Galaxy president and chief information officer Chris Ferraro.
It is important to note that Pantera was one of the biggest shareholders of Bitstamp after its initial investment of $10 million in the company in 2014. However, a significant stake was sold to NXMH, which acquired Bitstamp in 2018, a pan-European investment firm that claims to have €3 billion in assets under management (AUM), in an “all-cash deal.”
Pantera’s stake was reduced significantly post Bitstamp acquisition by the Belgium-based NXMH, and whatever was left has been acquired by Ripple. More importantly, it is currently unclear how much the San Francisco-based technology company paid for the remaining stake in Pantera Capital.
Bitstamp was one of the very first platforms to offer crypto transactions and was founded in 2011, when the crypto sector was new to everyone in the world. The company currently operates in around 100 countries and also ranks among the top 10 crypto exchanges by trading volume, as per the data from CoinMarketCap, with a volume of $175,002,445 in the past 24 hours.
Additionally, the ties between Bitstamp and Ripple were developed a number of years ago when the former acted as a gateway for the XRP token, which is termed a “security” by the United States Securities and Exchange Commission (SEC). Also, after the world’s largest crypto exchange, Binance, Bitstamp is the second-largest market for the XRP token.
As reported earlier by Bitnation, Ripple also announced the acquisition of Metaco, a Switzerland-based company founded in 2015 that provides “mission-critical custody infrastructure” and allows institutions to thrive in the digital asset industry. With this acquisition, the American fintech firm aims to expand its offerings and provide custody, issuance, and settlement of tokenized assets.
It is crucial to note that the SEC and Ripple have been involved in a legal battle for the past three years. A recent development took place in the case when Judge Analisa Torres made it clear that the Hinman Speech Documents would be made public. The documents are considered a vital part of the court proceedings by the company and its CEO, Brad Garlinghouse.