Coinbase has announced the acquisition of the Stryk brokerage platform’s parent company, BUX, in Cyprus. After the acquisition, the crypto exchange rebranded the company to Coinbase Financial Services Europe. The move has been seen by the market as a clear path toward dominating the European Economic Area (EEA).
According to reports, the acquisition has nothing to do with poaching users as BUX has already moved its users based in Cyprus to CFD Broker AvaTrade. The move has something to do with the company earning a Cyprus Investment Firm (CIF) license.
Coinbase to provide services to institutional investors
This license is a big deal because CFDs are very important in the financial market. They allow traders to speculate on asset prices without purchasing them. Meanwhile, Coinbase is not looking to onboard retail traders with its new acquisition. The country’s regulator, the Cyprus Securities and Exchange Commission (CySEC), has already approved Coinbase’s domain, but it has yet to be put to use.
According to rumors in the country’s financial industry, Coinbase wants to target institutional and professional players. This list includes hedge funds, big-money traders, trading firms, and not the regular guy looking for short-term profits from Bitcoin. The move is also in line with the company’s practice, where it has been trying to gain licenses across Europe since 2018 by setting up multiple localized platforms.
After several back-and-forths with regulators in 2020, the company launched Coinbase Pro in 2021. In 2022, it debuted staking services and crypto rewards to users in the eurozone. In addition, Coinbase also included several educational videos for users who wanted to learn about the crypto industry.
Coinbase started to dialogue with European regulators in 2023, a move that prepared it for the Markets in Crypto-Assets (MiCA) standards. However, November 2024 was a turning point, with the company closing down its USDC yield program because of the MiCA regulations. In December, the company delisted unauthorized stablecoins to stay compliant with the rules.