Cryptocurrency exchange Coinbase has acquired Xapo’s custody arm in a deal purportedly worth $55 million.
Coinbase revealed this procurement on August 15, mentioning that the acquisition will offer assistance in propping up Coinbase Custody, which has more than $7 billion worth of assets stored for over 120 clients.
Xapo is a Hong Kong-based firm that offers bitcoin cold wallet storage services. As of May 2019, it had near to $10 billion worth of bitcoin stored in underground vaults, Bloomberg stated.
Fortune revealed that the exchange had some strict competition from crypto asset management company Fidelity in its bid for Xapo’s institutional businesses, but eventually it was able to edge out the competition.
The Fortune report moreover included a quote from Coinbase Chief Executive Sam McIngvale, who uncovered the firm’s intention to extend into the cryptocurrency lending business. He added that it would be looking to assist investors in earning a profit on bitcoin lending, which the Xapo deal might be critical in bringing that mission to life.