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Softbank backed startup to offer retail crypto trading

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DriveWealth, a stock brokerage firm, has entered the cryptocurrency market by establishing two subsidiaries. That will enable its partners to offer crypto trading to individual clients.

DriveWealth is a $2.85 billion startup situated in New Jersey that is financed by Japanese tech giant Softbank.

In fact, traders forced to trade across an “unsustainable” transaction spread on Coinbase, according to DriveWealth CEO Bob Cortright. Prompted the move into the crypto industry. He went on to say:

“We can’t continue in a world where you can charge 200 basis points on a transaction as regulatory conditions tighten around crypto and clients become more interested in spreads and efficiency.”

Besides, Coinbase is the largest cryptocurrency exchange in the United States. With fees ranging from 4.5% of the transaction value to a spread fee. According to its financial report at the time, transaction fees accounted for 88% of the exchange’s $1.2 billion in total income in Q3.

Growing number of businesses are asking access to crypto liquidity

DriveWealth recently acquired Crypto-Systems, a different crypto firm, which enabled the additional crypto products. DriveWealth formed its DriveLiquidity subsidiary as a result of the acquisition. Which will provide liquidity to partners looking to engage in and trade cryptocurrency.

On the other hand, DriveDigital, a subsidiary crypto exchange of DriveWealth, has recently started. It intends to give its partners access to its API (application programming interface), allowing retail investors to trade Bitcoin (BTC) and Ethereum (ETH) (ETH).

According to Cortright, a growing number of businesses in a variety of areas are asking for access to crypto liquidity so that their customers can trade or receive crypto incentives. He went on to say:

“Even the most established, massive e-commerce firms are discovering that a large number of their customers desire to possess some cryptocurrency when they survey them.”

DriveWealth will face a significant uphill struggle if it wants to compete with Coinbase. As of the third quarter of 2021, the exchange had 68 million users. Coinbase (COIN) has a market capitalization of $39 billion and a $36.5 billion enterprise value.

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