Robinhood has agreed to purchase UK crypto firm Ziglu, because the US retail brokerage steps up its enlargement past share buying and selling and makes a second try to push into Britain.
The Californian firm mentioned on Tuesday that London-based Ziglu’s “impressive team of deeply experienced financial services and crypto experts [will help] accelerate our global expansion efforts”.
Ziglu, based in 2014 by entrepreneur Mark Hipperson who helped set up UK digital lender Starling Bank, permits retail traders to purchase cryptocurrencies. Robinhood didn’t say how a lot it was paying for Ziglu.
The group, which was valued at £85mn final November when it raised £7mn, mentioned its buyer base grew fourfold final 12 months as investor enthusiasm for crypto exploded and the sector attracted extra funding from mainstream monetary firms.
The acquisition by Robinhood comes simply over two months after the brokerage warned that the pandemic-driven retail buying and selling increase was cooling. Shares in Robinhood have fallen greater than 30 per cent this 12 months.
The Ziglu buy additionally palms Robinhood one of many few crypto teams to have gained approval from the UK’s monetary regulator.
The Financial Conduct Authority’s registration regime, which focuses on an applicant’s cash laundering controls and has been affected by delays, has given the inexperienced gentle to simply 33 of the greater than 100 crypto firms which have utilized since early final 12 months. The regulator has put new functions on maintain whereas it offers with the backlog.
Ziglu is the third UK crypto firm with FCA approval to attract the curiosity of a possible purchaser this 12 months. In February, Austrian alternate Bitpanda purchased Trustology. The following month, Binance introduced a partnership with alternate Eqonex, which owns an FCA-registered unit, in a deal the businesses mentioned might result in a tie-up.
The UK regulator has mentioned that whereas it doesn’t have the authority to analyze any change in possession of registered crypto companies earlier than a deal is accomplished, it may “take steps to suspend or cancel the registration of a cryptoasset business if it is not satisfied the firm or its beneficial owner is fit and proper” following a transaction.
Robinhood mentioned it will definitely deliberate to combine Ziglu and broaden its operations into Europe. The deal is the primary time the US brokerage has focused the UK because it deserted a plan to broaden into the market in July 2020.
The UK authorities earlier this month laid out plans to turn into a “global hub” for crypto as competitors amongst international locations to seize a share of the fast-growing however controversial business intensifies.