Crypto.com is making big moves with its licensing strategy, signaling a shift toward trading stocks. The company is acquiring firms during a time when cash is flowing in the industry. They expect to hear back from the SEC regarding their ongoing lawsuit soon.
As Bitcoin hits new highs, Crypto.com is using its cash reserves to expand beyond just cryptocurrencies. They’re planning to roll out trading for Tesla shares and gold for their 100 million users, including those in the U.S. This puts them in direct competition with major fintech players.
“We welcome competition,” said Eric Anziani, Crypto.com’s president and COO, in a chat with DL News. “We plan to be very aggressive.”
The timing of these acquisitions is crucial. The excitement from the launch of 10 Bitcoin exchange-traded funds in January, including one from the massive investment bank BlackRock, has validated the market. Larger fintech firms are also jumping into crypto. For example, Stripe recently acquired Bridge for $1.1 billion, and companies like Revolut and Robinhood are set to launch stablecoins next year, following PayPal's lead.
Things heated up even more after Donald Trump won the presidency. He promised lower corporate taxes, fewer regulations, and several pro-crypto initiatives. He even said he would create a national Bitcoin reserve and that all future Bitcoin would be mined in the U.S. As a result, Bitcoin's price has soared, rising 42% since his election night victory.
Despite the booming crypto market, Anziani emphasized that their acquisitions and the move into traditional stock trading were planned well before the political changes. “We’re happy with the new administration’s tone,” he noted. “But these deals have been in the works for quite some time.”
As the crypto market has grown, so has Crypto.com’s financial standing. Trading is one of their main revenue sources, along with fees from their Visa card program and yield-generating products. Recently, they surpassed Coinbase in trading volume, making them the second-largest exchange after Binance. “We have a strong business,” Anziani said. “Our balance sheet is solid.”
On October 31, the company announced three significant acquisitions in the U.S., Mauritius, and Australia. Anziani didn’t share specific costs, but he highlighted that all these firms have trading licenses. “To navigate this complex expansion, we chose acquisitions to speed up our market entry,” he explained.
The acquisition of Watchdog Capital will allow the Singapore-based firm to legally offer equity trading to U.S. users. Anziani emphasized that offering stocks and options is critical for the American market. They also acquired Fintek, an Australian brokerage, and Charterprime, a brokerage in Mauritius, to provide similar services.
However, the U.S. market has presented challenges. In August, the SEC accused Crypto.com of violating securities laws. The company responded with a countersuit, claiming that the SEC overstepped its authority. Anziani didn’t comment on the legal case’s status but mentioned that a representative from Crypto.com said, “We expect a response from the SEC soon.”
“We’ve completed the necessary steps to get this acquisition approved through FINRA, and it’s an SEC-registered venue,” he added. “We’re eager to get started.” FINRA stands for the U.S. Financial Industry Regulatory Authority.