Sources say that B2C2, a cryptocurrency market maker 90% owned by Japan's SBI Holdings, has been in contact with several potential buyers over the past 18 months to discuss selling a portion of its stake or the entire company. The negotiations have not been made public, and it is unclear whether these contacts are still ongoing.
A valuation exceeding $1 billion becomes an obstacle.
Sources familiar with the matter said the main reason for the slow progress in negotiations was a valuation disagreement. B2C2 hopes to achieve a valuation of over $1 billion, but this price is considered difficult to reach in the current crypto market environment. B2C2 declined to comment, and SBI had not responded by the time of publication.
Founded in 2015 and headquartered in London, B2C2 primarily provides digital asset liquidity and execution services to banks, exchanges, brokerages, hedge funds, and asset management institutions, covering spot, derivatives, structured products, and over-the-counter markets.
Industry mergers and acquisitions are still increasing.
This potential deal comes as M&A activity in the digital asset industry continues to heat up. As the market becomes increasingly institutionalized, exchanges, market makers, custodians, and fintech companies are all seeking to complete their product lines and expand their institutional business through acquisitions.
Overall trading volume in the crypto market has been weak this year, with macroeconomic concerns and a decline in risk appetite also suppressing the performance of digital assets. For market makers, whose revenue is highly dependent on trading volume and liquidity services, the slowdown in spot trading has also put pressure on industry profitability.
SBI has been continuously expanding its encryption footprint in recent years.
SBI Financial Services acquired a 90% stake in B2C2 in December 2020, following a $30 million investment in the company several months earlier. B2C2's financial data is not disclosed separately but is integrated into SBI's broader crypto asset business segment.
- For the fiscal year ending March 31, revenue from the related segment was 89.6 billion yen.
- Profit before tax was 21.2 billion yen, representing a year-on-year increase of 10.9%.
- SBI agreed last month to acquire Bitbank for approximately $289 million.
In addition, B2C2 explored raising up to $200 million from external investors last year. If the deal goes through, SBI could reduce its stake while simultaneously providing the London-based company with additional growth funds.
