Coinbase Global Inc. is the largest U.S. cryptocurrency exchange, and it’s about to get even bigger.
The San Francisco-based company is close to acquiring a major U.S. brokerage firm, according to people familiar with the matter. The move would give Coinbase a much-needed boost in its efforts to attract mainstream investors to the burgeoning market for digital assets.
Coinbase has been in talks to buy a stake in the brokerage firm, which is owned by a large financial institution, the people said. The talks are at an advanced stage and could be completed as soon as this month, though the deal could still fall apart, the people said.
Coinbase declined to comment.
The potential acquisition comes as Coinbase is facing increased competition from other cryptocurrency exchanges. Binance, the world’s largest exchange, is expanding its U.S. operations. And a new entrant, Kraken, is also making a push into the U.S. market.
In order to compete, Coinbase has been working to add new features and services. Last month, it launched a zero-commission trading platform for U.S. customers. And it is also planning to roll out a custody service for institutional investors.
The potential acquisition of a brokerage firm would be a major step for Coinbase in its efforts to attract mainstream investors. The company has been working to improve its image and reputation in the wake of the volatile market for digital assets.
In December, Coinbase hired a new chief compliance officer, Jeff Horowitz, who is a former executive at the New York Stock Exchange. And in January, the company hired a new chief executive officer, Brian Armstrong.
Coinbase has also been working to expand its reach beyond the U.S. market. Last month, it announced plans to open an office in Dublin. And it is also planning to launch a cryptocurrency exchange in Japan.
The potential acquisition of a brokerage firm would give Coinbase a much-needed boost in its efforts to attract mainstream investors to the burgeoning market for digital assets.