Crypto Titans Clash: Coinbase’s $2.9B Deribit Deal Has the Market Babbling

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Somewhere on the Discworld—if the Discworld had cryptocurrency and not just a suspicious amount of Guilder—it would probably look like this: On May 8, after what one imagines was a negotiation involving maps, charts, and possibly a rubber chicken, Coinbase (the Ankh-Morpork of US crypto exchanges) decided to snap up Deribit for the princely sum of $2.9 billion. Yes, billion. Apparently nobody told them you can get a decent troll for half that.

Industry titans (the type who wear rings with secret compartments) are fluttering fans and mopping brows, because this makes Coinbase the new big cheese in crypto derivatives, which are financial products you buy when you want to sound clever at parties or accidentally leverage your cat’s tuition fund. 🧀

In the shadowy alleyways of the crypto market, Coinbase’s blog post practically shouted, “We are now the largest in open interest!”—which sounds terribly impressive until you realize open interest in Klatchian means, “I have no idea what’s actually going on, but it’s happening at scale.”

Jeff Park, who presumably collects alpha strategies like stamps, declared on X (not to be confused with any other mysterious letter) this was perhaps the best value deal he’d ever seen, hinting Coinbase had picked a golden goose—or at least a well-fed duck. 🦆

And lest you think Kraken was sitting quietly in a corner like a bashful librarian, in March they waved a $1.5 billion check in NinjaTrader’s direction, possibly startling several ninjas and two accountants.

Expanding global footprint (and possibly several toes)

Coinbase’s ever-growing presence in perpetual futures—about $10 billion per day, give or take a few zeroes—has already caused mathematicians* to sprain their abacuses. The US-wing of Coinbase has no less than 20 futures contracts, which is more contracts than most citizens of Ankh-Morpork have socks. 🧦

Deribit, with open interest measured in trillions (insert Dr. Evil finger here), is universally acclaimed as having the most options, though none of them involve buggies or well-cooked bacon. And with the Deribit deal, Coinbase has wrangled every possible permutation of regulated and self-regulated derivatives, which sounds like a wizard’s laundry list and is just as complicated.

This is all, as industry oracle Yang noted, an attempt to challenge Binance—still the top dog in global volume terms (and, possibly, in top dog collecting events). Notably, Deribit doesn’t serve US-based traders, presumably out of respect for confusion, regulation, or just a desire to avoid explaining things to enthusiastic attorneys.

“Deribit is the platform of choice for global traders in Bitcoin and Ethereum options,” Yang declared, which sounds awfully grand, but let’s face it—he’s not entirely wrong. And lest you feel left out in this world of futures and options, those are basically just agreements to buy or sell magical beans at some point in the future, except the beans are all invisible, and you don’t even get a cow. 🫘

Options let you decide whether or not to buy beans at a certain price, leading to endless philosophical debates best left to philosophers, or at least the guy with all the hats on the corner of Sator Square.

And that, gentle reader, is how a simple acquisition becomes the Discworld’s latest epic saga—complete with drama, mysterious financial instruments, and not nearly enough custard tarts.

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2025-05-09 00:58