Crypto.com trades to buy two IG Group products for US

Crypto.com, a fast-growing Singapore, has entered into an agreement with IG Group to acquire two products that will help them stabilize the US-based commodity market.

The company, which attracted interest last month when it paid $ 700m to change the Los Angeles’ main name basketball court, Wednesday agreed to a $ 216m deal to buy an IG share on future US exchanges with a binary options trading company owned by FTSE 250.

The deal could provide Crypto.com with a way to deliver transactions and futures to US customers, an area that has been difficult to exchange crypto given strict rules about providing these risky items to retailers.

Kris Marszalek, chief executive of Crypto.com, said the acquisition was “to help our customers find new financial tools to support what we offer here”.

The consortium also includes the North American Derivatives Exchange (Nadex), which provides traders with binary options trading in case something happens, such as a rise or fall in currencies, stocks or policies, within a certain period of time.

This can be as short as five minutes. Providers often allow customers to increase their bets by using borrowed money, increasing potential gains and increasing losses that consumers are at risk of. Nadex says customers are told to benefit from the huge losses they may face before the trade begins.

IG Group will also sell its 39 per cent stake in the Small Exchange, a futures exchange targeted retailer, established last year and supported by leading Wall Street players including Citadel Securities, Jump and Interactive Brokers along with Peak6, a business vehicle operated by former Chicago options trader Matt Hulsizer.

The parties say the agreement is expected to close in the first half of 2022, subject to legal approval. Both companies should be brought under the Crypto.com brand, the exchange said, but their executives will remain in place.

June Felix, chief executive of IG Group, said the sale allowed the company to “grow our interest” by combining and expanding its options with the future business through Tastytrade, a US brokerage firm. purchased for $ 1bn in January.

While highly profitable, the derivation has been a challenge for some crypto groups as dangerous devices are heavily operated by regulators in many countries.

A U.S. court of law earlier this year ordered the crypto operator BitMex to pay $ 100m public fine by providing crypto-type trading without proper authorization.

The Commodity Futures Trading Commission, which oversees the US market, introduced the suit in 2020 stating that BitMex “has been using the cryptocurrency advertising platform”. BitMex said at the time it had taken its “role very seriously, and will continue to engage actively with regulators around the world”.

Crypto.com, a five-year-old private company with 3,000 employees worldwide, has recorded a 20-year turnover and a lot of losses, Marszalek told the Financial Times last month, as digital business grows exponentially. .