Coinbase Expands in Europe

Crypto exchange Coinbase has acquired a crucial license for its European expansion via the purchase of the Cyprus unit of European brokerage Bux.

The acquisition was finalized in August, as noted in a recent blog post by the company, revealing it obtained a Markets in Financial Instruments Directive II (MiFID II) license through this purchase. The deal was initially highlighted by Finance Magnates, which also mentioned that Coinbase rebranded the entity to Coinbase Financial Services Europe in October.

According to the blog, “Adding such a license to our international portfolio would further support the strong interest we’ve seen in our derivatives offerings and help us capture more of the ~75% of the global crypto market claimed by derivatives.”

The MiFID II regulation was enacted in January 2018, and although the newly-acquired license is based in Cyprus, it can be “passported” to other EU member states, allowing Coinbase to offer its services across Europe more efficiently without needing separate licenses in each jurisdiction. Bux previously used this license to provide contracts for differences (CFD) trading products.

Coinbase’s blog post cautioned that there is still significant work to finalize the acquisition and operationalize the EU MiFID licensed entity. However, its August update suggests the license could be functional “later this year [2024],” with a potential full launch by early 2025.

The financial details of the deal remain undisclosed. Bux was formerly acquired by Dutch bank ABN AMRO in a deal announced in December 2023 and completed in July 2024. Additionally, Bux sold its UK subsidiary to UAE-based APM Capital last July as part of its strategy to divest all regulated subsidiaries of Bux Holding, according to its CEO.