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Today, both WonderFi and Coinsquare are big players in the Canadian crypto industry.
A Bloomberg report suggesting that WonderFi is in talks with Coinsquare over a potential merger has emerged. In that report, Bloomberg noted that the merger talks were advanced and an official announcement could follow in a few days. If the merger is successful, Coinsquare holders may take a majority stake in the combined company, as well as on the board of the new firm.
Following the report, the shares of WonderFi rose by up to about 30%, forcing the Toronto Stock Exchange to halt the trading of the shares. What makes the news even more plausible is that Coinsquare recently terminated its earlier announced merger with CoinSmart. CoinSmart CEO Justin Hartzman noted that the decision to pull out of the merger took him by surprise.
WonderFi has since responded to the rumor at the instance of the Investment Industry Regulatory Organization of Canada (IIROC). According to its public statement, the firm can neither confirm nor deny the report that it was in advanced merger talks with Coinsquare. The company noted it has had preliminary discussions with several third parties over possible acquisitions. This, it noted, was consistent with its usual practice.
“These discussions are preliminary in nature and are ongoing and there can be no assurance that any agreement or understandings will be reached or that the terms of any transaction will be agreed or that any transaction will be completed,” it concluded.
What a Successful Merger Would Mean
2021 was a busy year of acquisitions for WonderFi. After acquiring First Ledger Corp, the parent company of Bitbuy, for $162 million, it also acquired crypto exchange Coinberry for $38 million. In September, it acquired Blockchain Foundry, with Kevin O’Leary commenting that there are more acquisitions on the way. Should the merger talks with Coinsquare prove true and successful, it could produce the largest cryptocurrency industry players in Canada.
Today, both WonderFi and Coinsquare are big players in the Canadian crypto industry. WonderFi has an estimated 650,000 users and $258 million in assets under management. According to Bloomberg, Coinsquare also has about 500,000 users. Any merger between the two firms would significantly impact the country’s crypto landscape and tilt the balance against competitors.