What The FTX? — FTX’s Expansion Shopping Spree In Full Swing
Leading crypto exchange FTX has been aggressively expanding lately. The company has acquired several crypto startups, inked deals with various industries, and partnered with a number of high-profile figures, stretching its business into new jurisdictions.
How Is FTX Expanding?
FTX, a cryptocurrency exchange specializing in derivatives and leveraged products, has been looking to expand its ventures lately. According to Sam Bankman-Fried, founder and CEO of FTX, the company has allocated half a billion dollars to acquisitions so far this year.
In late October, the exchange finalized its acquisition of LedgerX, a regulated digital currency futures and options exchange. The acquisition grants FTX.US, the US arm of FTX, a slew of licenses that were given to LedgerX by the US Commodity Futures Trading Commission (CFTC). Commenting on this, Brett Harrison, president of FTX.US said:
“We believe the integration of the two organizations provides us with not only a technological advantage, but also furthers our working relationship with the regulatory community in a positive, constructive and transparent manner.”
Prior to this, FTX.US launched an NFT marketplace, allowing users to trade, mint, and auction Solana-based NFTs. The exchange also plans to add support for NFTs on the Ethereum blockchain, where the bulk majority of digital collectibles are traded.
The exchange has been quite busy with new partnerships this month, too. On November 5, FTX announced that it has joined Lightspeed Venture Partners and Solana Ventures to invest $100 million in Web 3 gaming development. The joint initiative will focus on “investing in gaming studios, platforms, and infra companies at the intersection of blockchain and gaming in the Solana ecosystem and beyond.”
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FTX Is Adding More To Its Operations
On the same day as the Lightspeed Venture Partnership, the US arm of the company published a press release, revealing it has added an anti-financial crime suite from TRM Labs, a blockchain intelligence provider, to increase its capabilities of monitoring crypto transactions. Reportedly, the company has integrated TRM’s Transaction Monitoring and Forensics tools, which are used for crime compliance and risk management. FTX President, Brett Harrison said:
“Knowing that compliance is of the utmost importance, our approach to the business is to ensure our platform uses the most advanced risk management tools on the market, so that our users can trade with ease and peace of mind.”
Harrison added that as the exchange resumes its expansion into other trading realms like options and futures trading, it becomes crucial to provide industry-leading compliance tools for users. “Our addition of TRM Labs demonstrates our commitment to using the most cutting edge technology available for this purpose,” he said.
Most recently, FTX backed the crypto exchange CoinMENA; a fiat to crypto exchange that provides services in the Middle East and North Africa in a $9.5 million seed round. With this, FTX is officially expanding into the Middle East and North Africa markets, yet another major partnership for the company.
Aside from recent acquisitions, 2021 has also been the year of massive mainstream partnerships for FTX. In late August, the exchange acquired the naming rights for Cal Memorial Stadium. Prior to that, FTX had inked partnerships with Miami’s professional basketball team, the Heat, the League Championship Series (LCS), and TSM, the premier global esports organization.
In an interview with Coindesk, CEO Sam Bankman-Fried said they intend to further grow their business by purchasing crypto firms and startups. “I would not be surprised if [the amount of money that we spend on acquisitions over the next year or so] was north of a billion dollars,” he said.
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Who Is Sam Bankman-Fried?
FTX is a Bahamian-based cryptocurrency exchange founded in May 2019 by Sam Bankman-Fried. The son of two Stanford law professors, Bankman-Fried is currently the richest person in crypto with a net worth totaling $26.5 billion, as per Forbes.
In July 2021, FTX raised $900 million at a valuation of $18 billion. However, a fundraising round in late October saw the company raise $420,690,000 million from a total of 69 investors, boosting its valuation to $25 billion. Notably, the company said that the numbers “420” and “69″ are an obvious acceptance of meme culture—something people in crypto appreciate.
Alfred Lin, General Partner at Sequoia Capital, who had participated in the fundraising, praised FTX’s founder, saying:
“Sam Bankman-Fried is a special founder who is ambitious and daring enough to build the future of crypto by establishing FTX as the global exchange with the best overall product offering and leveraging the world’s crypto rails to build the future of finance. We are thrilled to partner with FTX on their next phase of growth.”
With so many acquisitions, don’t you think FTX might get distracted? Let us know in the comments below.