Coinbase Acquires One River Digital Asset Management
Crypto exchange Coinbase announced it bought One River Digital Asset Management (ORDAM), marking its latest move to boost institutional crypto adoption. ORDAM will operate as an independent business and a wholly-owned subsidiary of Coinbase under a new name – Coinbase Asset Management.
ORDAM to Operate as Coinbase’s Independent Business
Coinbase announced it had acquired ORDAM, a digital asset management firm that serves institutional investors. As a result of the acquisition, ORDAM will be renamed Coinbase Asset Management (CBAM) and will operate as Coinbase’s independent and wholly-owned subsidiary.
“An SEC-registered investment adviser, ORDAM will form the foundation of Coinbase Asset Management and offer investment advisory services to a range of new and existing institutional clients.”– Coinbase stated in the announcement.
The move comes as part of Coinbase’s plan to bridge the gap between institutional investors and the crypto economy, the exchange added in the announcement. Greg Tusar, Coinbase’s head of institutional product, said the acquisition aims to bring “more institutional capital into the world of crypto.”
Founded by macro trader Eric Peters, ORDAM is a crypto asset manager that focuses solely on serving institutional clients. Such a business model, which completely avoids retail investors, allows the firm to concentrate on long-term capital and money management while limiting exposure to high volatility in crypto prices.
Peters will retain his role as CEO of Coinbase Asset Management and One River Asset Management, the parent company of ORDAM. The financial details of the deal were not disclosed.
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Coinbase’s Push for Institutional Trading Continues
The buyout of ORDAM represents the latest effort by Coinbase in its push to drive crypto adoption among institutional investors. The crypto exchange reached a landmark deal in August 2022 with BlackRock, the world’s largest asset manager, to offer crypto services to institutional investors.
Last month, Coinbase reported better-than-expected earnings and revenue in Q4 2022, but the report clearly showed how damaging the “crypto winter” has been for the digital assets sector. The company’s fourth-quarter revenue of $600 million exceeded expectations but was down significantly compared to Q4 2021, when the crypto exchange generated $2.5 billion.
While Coinbase’s overall trading volume declined, the financial report highlighted the divergence between the crypto exchange’s retail and institutional volumes. The company’s consumer trading volume stood at $20 billion in Q4, compared to $125 billion in institutional volume.
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