Bitbuy, a regulated subsidiary of Toronto’s WonderFi, has acquired the Canadian customers of Bitstamp as the latter cryptocurrency trading platform pulls out of Canada.
Citing “timing and resource allocation challenges” meeting new regulations, Bitstamp has ceased operating in Canada.
Through a business transfer agreement announced late last week, Bitbuy has purchased more than 110,000 retail and institutional client accounts from its former competitor Bitstamp.
WonderFi did not disclose the financial terms of the transaction beyond noting that it was non-dilutive. Bitbuy also plans to share a portion of the associated revenues from these customers with Bitstamp going forward.
The Bitstamp deal marks the latest in a long line of acquisitions for WonderFi. As BetaKit has previously reported, it also comes at a time when some of WonderFi’s shareholders, including Kaos Capital and Mogo, have been pushing for an overhaul of its board of directors. Kaos and Mogo have claimed WonderFi has underperformed despite a strong crypto market. For its part, WonderFi has claimed that Mogo is seeking control of it without paying a premium.
Bitbuy, which was purchased by WonderFi back in 2022, permits Canadians to buy, sell, and trade a variety of digital assets, including Bitcoin and Ethereum. Bitstamp, which is headquartered in Luxembourg and caters to a wide variety of countries, previously competed with Bitbuy in Canada.
Last year, after Canadian securities regulators began tightening rules for crypto exchanges operating in Canada following the collapse of numerous unregulated platforms, Bitstamp shared plans to leave the Canadian market in 2024, joining a group of other firms to do so in recent years, including Binance, OKX, and Paxos.
In a statement posted to the crypto firm’s website, Bitstamp said its decision to discontinue operations in Canada was “primarily due to timing and resource allocation challenges in meeting new regulations.”
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Bitstamp said it chose to sell its client accounts to Bitbuy due to its “strong reputation in the cryptocurrency market, regulatory compliance, and commitment to security and customer service.”
In a statement, WonderFi president and CEO Dean Skurka described this transaction as “consistent with WonderFi’s disciplined approach of pursuing growth opportunities on its platforms.”
With this deal, WonderFi now has a collective user base of over 1.75 million registered Canadians and more than $1.5 billion CAD in combined assets under custody across its two remaining crypto exchanges, Bitbuy and Coinsquare, which it operates alongside its global crypto payments platform, SmartPay.
As BetaKit reported last month, WonderFi also recently took a step towards expanding internationally by purchasing an Australian crypto trading licence.
Feature image courtesy WonderFi.
The post WonderFi’s Bitbuy purchases clients of Bitstamp as fellow crypto exchange exits Canada first appeared on BetaKit.