Coinbase purchases One River Digital in move into asset management business

Crypto exchange Coinbase is buying crypto asset manager One River Digital Asset Management.

"Coinbase and ORDAM share an ethos grounded in prudent risk management, a trait which has enabled both firms to successfully navigate the recent market turmoil," the company said in a statement.

One River Digital Asset Management is a subsidiary of hedge firm One River Asset Management, which was founded by Eric Peters in 2013. The firm will be renamed Coinbase Asset Management, and Peters will serve as its CEO and chief investment officer. It will operate as an independent business and wholly-owned subsidiary of Coinbase, the company said.

Peters will stay on as the CEO and chief investment officer of One River Asset Management, which remains a separate firm.

'Institutional capital'

“This is about wanting to bring more institutional capital into the world of crypto,” Greg Tusar, Coinbase’s head of institutional product, said in an interview with Bloomberg. “We expect to build — on the other side of this crypto winter — an awesome asset-management business.”

Coinbase declined to disclose the terms of the deal in the Bloomberg interview but said the negotiations had been ongoing for a year.

Coinbase backed One River Digital in its Series A fundraising round alongside Goldman Sachs. The startup broke cover in 2020 when it emerged that the company was eyeing a $1 billion allocation to bitcoin with the backing of billionaire hedge fund manager Alan Howard.

The startup teamed up with Coinbase at the start of last year to offer a platform that would allow wealth managers to provide crypto exposure to their clients. 

The purchase announcement comes a day after Coinbase and many other large industry players said they would no longer bank with Silvergate, a prominent industry banking partner.