Three of Canada’s largest cryptocurrency companies are joining forces to create a new trading platform.
WonderFi (WNDR), Coinsquare and CoinSmart have announced that they plan to merge to create what would be Canada’s largest regulated cryptocurrency exchange called “Coinsquare Capital Markets.”
Under terms of the deal, publicly traded WonderFi will issue 269,727,080 common shares to privately held Coinsquare and 119,181,733 common shares to privately held CoinSmart.
Once the transaction is completed, WonderFi will own 38% of the new company, while Coinsquare will own 43% and CoinSmart will control 19%.
The new cryptocurrency trading platform will have 1.65 million users and $600 million in assets under custody.
The companies, none of which are profitable on their own, said the merger will provide them with a path to profitability as securities regulators in Canada enhance their oversight of the cryptocurrency industry.
Regulators around the world are tightening the rules around cryptocurrency trading following the $8 billion U.S. collapse last year of the FTX exchange.
Last autumn, Coinsquare became the first Canadian crypto platform to be registered with the Investment Industry Regulatory Organization (IIROC).
WonderFi’s stock has declined 68% in the last 12 months and now trades at 20 cents per share.
