Cryptocurrency yielded an all-time high record in mergers and acquisitions (M&A) in the first quarter of 2023 with a total of 54 transactions. Despite the surge in the quantity of deals, the value of transactions totaled to about $400 million, dramatically lower compared to the actual value in the first quarter of 2022.

Many of the involved firms were crypto natives, accounting for 36 out of the 54 deals; something that went against historical trends. There was a shift from traditional finance companies purchasing capabilities in 2021, to crypto companies investing in infrastructure which accounted for 43% of the M&A activity.

Steve Payne, a co-founder of Architect Partners, highlighted three deals in particular as 'emblematic' of the state of the market. His first example was of Coinbase acquiring One River Digital Asset Management. The exchange aspired to offer investment advisory services to institutional clients and did so by purchasing an SEC-registered investment advisor. His second point of focus was ConsenSys buying blockchain development tooling platform HAL, which Payne identified as fitting the trend of companies investing in such infrastructure to build Web3 applications - with dapps making up 43% of the M&A activity. The last example was that of Hut 8 Mining and US Bitcoin Corp, who announced plans to merge that exhibits the difficulties that similar companies face due to decreased pricing and growing difficulty of mining; further leading to consolidation of the bigger players.

All in all, the first quarter of 2023 was a significant one in the world of cryptocurrency, with the number of M&A transactions hitting an all-time high. The market, as epitomized by the three aforementioned deals, still exhibits a drive towards pioneering what the world of finance and business can bring through cryptocurrency. However, the value of such deals may not reach the peak of 2022 any time soon, according to Payne.



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