WonderFi releases public statement following Coinsquare merger report

WonderFi team at Toronto Stock Exchange
WonderFi neither confirms nor denies Coinsquare merger report, saying it's both looking at potential acquisitions and being acquired.

WonderFi released a statement on Thursday afternoon stating it has held preliminary discussions with companies about potential acquisitions.

The statement followed a BNN Bloomberg report claiming WonderFi and Coinsquare are exploring a possible merger. BetaKit has not independently verified the claim.

WonderFi said that the crypto company “has held preliminary discussions with various third parties with respect to both potential acquisitions and [WonderFi] being acquired.” WonderFi called this consistent with its past practices and its “general acquisition strategy.”

Statement neither confirms nor denies report WonderFi and Coinsquare are in “advanced merger talks.”

“These discussions are preliminary in nature and are ongoing, and no assurance can be given that any agreement or agreements will be reached, or that the terms of a transaction will be agreed upon or that a transaction will be completed,” stated WonderFi, adding that the firm “does not intend to make further comment unless or until an agreement has been entered into and there is a transaction to announce.”

The statement neither confirms nor denies BNN Bloomberg’s January 12 report that Vancouver-based WonderFi and Toronto’s Coinsquare are in the midst of “advanced merger talks.” Citing anonymous sources familiar with the matter, BNN Bloomberg reported that an announcement is “possible in just days.” WonderFi and Coinsquare both declined to comment for this story.

WonderFi said its public statement was “issued at the request of the Investment Industry Regulatory Organization of Canada (IIROC) in regard to recent market activity.” IIROC temporarily halted trading of the company’s stock earlier today.

WonderFi trades on the Toronto Stock Exchange under the symbol ‘WNDR.’ Since BNN Bloomberg’s story was published earlier today, WonderFi’s stock price has climbed about 16 percent to $0.31 CAD per share at time of publication.

The BNN Bloomberg report comes just days after Coinsquare moved to terminate its deal to buy fellow registered Canadian crypto exchange CoinSmart. It is a maneuver that CoinSmart co-founder and CEO Justin Hartzman told BetaKit took his company “by surprise.”

RELATED: Coinsquare moves to terminate CoinSmart acquisition deal

When reached by BetaKit, neither Coinsquare nor CoinSmart provided a reason for the former moving to back out of the deal. “Coinsquare exercised its rights to terminate the agreement with CoinSmart in accordance with its terms,” Coinsquare COO Eric Richmond told BetaKit, adding, “we have no other comments at this time.” According to Hartzman, CoinSmart’s management and board of directors are in the process of evaluating the validity and effectiveness of Coinsquare’s notice.

WonderFi and Coinsquare, which are both registered with Canadian securities regulators, represent two of Canada’s largest cryptocurrency players. Any combination of the two crypto trading firms and competitors would have a significant impact on the country’s crypto landscape. According to BNN Bloomberg, the two companies would have a combined user base of around 1.15 million people if the deal goes through.

The potential merger comes amid challenging conditions for crypto companies. Recent market volatility has helped fuel consolidation in the sector, and WonderFi itself has already acquired two other registered crypto trading platforms in Bitbuy and Coinberry over the past year.

Coinsquare’s proposed acquisition of CoinSmart represented a similar move, with the former claiming last year that the acquisition would create one of the country’s largest crypto asset trading platforms.

Feature image courtesy WonderFi.

Josh Scott

Josh Scott

Josh Scott is a BetaKit reporter focused on telling in-depth Canadian tech stories and breaking news. His coverage is more complete than his moustache.

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