Robinhood purchases WonderFi to boost its presence in Canada.

Robinhood purchases WonderFi to boost its presence in Canada.

Spunky 'Hood Snaps Up Canadian Crypto Giant, Steps Up Global Game

Here's the lowdown on Robinhood's latest power move: They're diving headfirst into the crypto arena with a whopping C$250 million (roughly US$178 million) all-cash takeover of Canadian crypto powerhouse, WonderFi. This acquisition, set to close in the second half of 2025, marks a significant stride in expanding Robinhood's global crypto influence.

WonderFi, a company that runs two of Canada's top regulated crypto platforms—Bitbuy and Coinsquare—will continue operating under Robinhood Crypto. The deal gives Robinhood access to over C$2.1 billion in assets under custody and enables them to swim in one of the fastest-growing crypto markets worldwide.

Shareholders of WonderFi will receive C$0.36 per common share, a hefty 41% premium over the platform's May 12 closing price and a mighty 71% premium over the 30-day volume-weighted average price.

WonderFi's bigwigs, including CEO Dean Skurka, will hop aboard the Robinhood ship upon completion, taking up key roles in overseeing Canadian operations. Employees from WonderFi will join forces with Robinhood's existing Canadian workforce, which counts over 140 employees based in Toronto.

"WonderFi has built a solid team that caters to both beginner and advanced crypto users, making them the perfect partner to propel Robinhood's vision in Canada," expressed Johann Kerbrat, General Manager of Robinhood Crypto.

Robinhood has been beefing up its crypto game over the years, adding the 2024 acquisition of Bitstamp for $200 million to its arsenal. By snatching up WonderFi, they aim to serve Canadian retail investors with a wide array of crypto services, including trading, staking, and custody.

WonderFi boasts approximately 1.6 million users and reported over C$3.57 billion in trading volume last fiscal year, representing a 28% year-over-year increase. Since going public via a reverse takeover in 2021, WonderFi has grown into one of Canada's leading crypto providers.

Robinhood is planning to finance the deal using its coffers, with J.P. Morgan serving as their financial advisor. WonderFi received advice from FT Partners and multiple legal and financial firms.

WonderFi aims to bring its gold-backed stablecoin to Thailand as demand for inflation hedges continues to grow.

Behind the Business Deal

Robinhood Markets, a prominent online brokerage platform, signed a definitive agreement to scoop up WonderFi Technologies, a Canadian-based company managing regulated crypto trading platforms. The all-cash deal, valued at C$250 million (approximately US$179 million), is subject to shareholder approvals and regulatory requirements. [Source: 2, 4, 5]

WonderFi: A Closer Look

Established in 2021, WonderFi's mission is to democratize digital asset access. The company operates various platforms, such as Bitbuy and Coinsquare, that offer crypto trading, staking, investor education, and over-the-counter transactions. Last year, WonderFi processed over $2.56 billion in crypto trading volumes, indicating a 28% increase compared to 2023. [Source: 2, 5]

Acquisition Terms

• Purchase Price: Robinhood will shell out $0.25 (C$0.36) per WonderFi share, representing a 41% premium over the closing price of WonderFi's shares prior to announcement.
• Closing Conditions: The acquisition is contingent on obtaining necessary approvals from WonderFi's shareholders.
• Integration Plans: WonderFi's leadership team will join Robinhood Crypto, and its employees will integrate with Robinhood's existing Canadian workforce.

Impact on Robinhood's Global Crypto Footprint

This acquisition significantly boosts Robinhood's presence in Canada, a strategic move that helps them grow their crypto services globally by leveraging WonderFi's established platforms and Canadian market expertise. [Source: 2, 5]

Key Benefits

• Market Expansion: The acquisition will empower Robinhood to fortify its position in the Canadian market, a crucial step in expanding its global crypto reach.
• Regulatory Advantage: WonderFi's regulated platforms offer Robinhood a compliant framework for crypto services, minimizing regulatory risks and paving the way for smoother Canadian operations.
• Technological Integration: The integration of WonderFi's technology and platforms will bolster Robinhood's crypto trading and staking capabilities, potentially attracting more users to its services.

Overall, Robinhood's acquisition of WonderFi is a strategic play to expand its global crypto operations and strengthen its presence in vital markets like Canada.

1. Robinhood's acquisition of WonderFi Technologies, a Canadian crypto giant, will allow them to offer additional services such as trading, staking, and custody to Canadian retail investors.
2. WonderFi, with its gold-backed stablecoin and regulated crypto platforms, aims to bring digital asset access to new markets, such as Thailand, where demand for inflation hedges is growing.
3. The all-cash takeover of WonderFi will give Robinhood access to over C$2.1 billion in assets under custody and enable them to operate in one of the fastest-growing crypto markets globally.
4. With this acquisition, Robinhood is poised to further its global crypto finance business by capitalizing on WonderFi's market expertise and compliance framework. This strategic move will help Robinhood compete more effectively in the rapidly evolving technology-driven crypto industry.

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