Coinbase announced the acquisition of Xapo’s institutional business for $55 million. After this move, Coinbase Custody holds around $7 billion worth of digital assets.

With coinbase announcing Xapo’s acquisition, all Xapo customers will have to decide whether or not they’d like to continue with Coinbase for storing their assets.

According to sources, most of Xapo’s customers have already decided to transfer their funds to the new platform. And, if Coinbase manages to convince all other Xapo clients, Coinbase Custody is going to have almost 860,000 Bitcoin under control. The figure makes almost 4% of the total supply of Bitcoin.

“This acquisition caps off a tremendous period of growth and innovation for Coinbase Custody. In just over one year since launch, Coinbase Custody has grown to over $7 billion in Assets Under Custody (AUC) stored on behalf of more than 120 clients in 14 different countries, making it the largest, most globally recognized and most trusted institutional custodian in the world,” the Coinbase team pointed out on their blog.

The experts have already started highlighting Coinbase Custody’s tremendous growth within just a year. Only a couple of months back their reported AUC was valued at $1.3 billion. As mentioned earlier, with this new deal, that has now grown to around $7 billion worth of digital assets. 

There had been earlier speculation that Coinbase was very much concerned about Fidelity Digital Assets, the company that became a major competitor only after entering the industry recently. However, with this acquisition of Xapo, Coinbase Custody has become the leading cryptocurrency custodian.

Founded back in 2014, Xapo provided a Bitcoin wallet as well as cold storage vault services. According to the company’s declaration, it held $10 billion worth of crypto assets which belonged to around 1.5 million of its customers from around the globe. The company had acquired $5.5 billion worth of digital assets under its custody reflecting somewhere around 700000 BTC.