Crypto: WonderFi CEO explains $162M purchase of Bitbuy

WonderFi CEO Ben Samaroo joins Yahoo Finance Live to discuss the acquisition of crypto-trading platform Bitbuy, the company's future in growing within the crypto space, and the 2022 outlook for crypto.

Video Transcript

ALEXIS CHRISTOFOROUS: I want to get to a deal in the crypto space this week and an exclusive interview we have. WonderFi Technologies, which is backed by the "Shark Tank" investor Kevin O'Leary, has agreed to buy the parent company of the Canadian crypto exchange BitBuy. The price tag here, $162 million.

And joining us now is wonder CEO Ben Samaroo. Ben, great to see you. Congratulations on the deal. I know that this makes you the owner and operator of the first crypto marketplace license in Canada. In regular speak, what does that mean for your company? What does it mean for investors in crypto?

BEN SAMAROO: It's great to be here. So we believe this is actually the biggest crypto acquisition in Canadian history. So it's a really big step forward for the Canadian market, the deal itself. The license that BitBuy has in the business that they're operating, what it means is it means better transparency, liquidity, and pricing for users that are trying to access crypto in Canada, which is extremely important.

And it also provides them with compliant access to crypto, which has been a challenge for many people in many markets leading up until now. And that's why people are really excited about this business, this license, and this acquisition.

- Thank you for coming on, sir. So I understand the added value that the company brings you. But what do you provide as far as added value to the company?

BEN SAMAROO: So it's a really great fit from a product standpoint and from a management standpoint. What we've been building at WonderFi is better access to decentralized finance services. So that's more on the peer-to-peer crypto assets and different services. And this is something that has been a really high growth part of the crypto space.

Last year saw incredible growth in the DeFi space. And what this allows us to do with BitBuy is to offer end-to-end services to customers who are looking to access the space.

ALEXIS CHRISTOFOROUS: What's your customer base looking like? I mean, what did it look like, I guess, before this acquisition, and now with the BitBuy parent company, how does this grow your overall base? And what kind of products or capabilities will you be able to do as you continue to scale your business because of this acquisition?

BEN SAMAROO: BitBuy has almost 400,000 users in Canada. And we believe that's the largest crypto exchange or marketplace in the country. We're looking at expanding that business into other jurisdictions in a regulated fashion. The demand for a regulated marketplace that provides customers with easy access to crypto is growing drastically.

And what we're able to do with WonderFi really is to bring some of these cutting edge products to the table and allow customers to access those. So we're really excited from that perspective. And also from an investment standpoint, WonderFi as a public company now having BitBuy under its umbrella, it allows a lot of institutional investors to get access to a compliant crypto investment.

So as we continue to grow WonderFi, BitBuy, another companies and products that we're looking to roll up in the space, this becomes a really compelling investment proposition for institutions and other investors that are just looking for that compliant access to an investment in the space. And perhaps they're not interested in holding the crypto assets directly just yet.

- And where do you see crypto heading this year? Because you know, there are optimists who talk about Bitcoin hitting 100,000. But there is so much talk about regulation. Are you concerned about what impact that may have on your business model?

BEN SAMAROO: Regulation really is part of our business model. And I think for the industry as a whole, it is a big step forward every time there is more regulatory clarity around crypto or regulations do get released by different jurisdictions. The reason for that is, again, on the institutional side, you have a lot of institutional capital that's come into the crypto space in the last 18 months, two years.

But there are still people that are sitting on the sideline because they're looking for clarity from specific regulators. And then from a retail end user standpoint, it's the same story. There still is a huge portion of the population that is not accessing crypto.

They've heard about it. They're interested. They see some of the benefits versus the existing financial system. But they're really cautious from a compliance standpoint. And so as regulation unfolds, it's going to increase the adoption of crypto globally.

ALEXIS CHRISTOFOROUS: I'm curious how you're handling these altcoins, Ben. We've got, you know, Dogecoin, Shiba Inu, there's Safemoon, Polkadot. The names are growing, I feel, by the week. What's your outlook on those? And are those some of the products that you're offering?

BEN SAMAROO: My outlook, and as a company, our outlook, on some of the newer coins and altcoins is that it all comes down to what value each coin or asset is providing. And so I think, you know, I would always encourage people to really think carefully about what the reason is that that asset exists.

Bitcoin is the easiest to understand. It's digital gold. And that's the reason why so many people have come into that asset class, and it's grown from a retail and an institutional standpoint. Ethereum and ETH, the asset, have grown as well because people are starting to realize that the applications for ETH within the decentralized finance space and within NFTs and other areas really is compelling and there's a ton of value there.

So as you start to get into other coins, you know, there is a lot of speculation around some of these assets. And I would definitely encourage people to sort of slow down on those. And that's what we do as a company. Having been in the crypto space for a long time, it's all about, where is the value? And why are people using this asset?

ALEXIS CHRISTOFOROUS: All right, Ben Samaroo, Co-Founder, CEO of WonderFi, always good to see you.