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M&A deals done in digital coins doubles

  • Aggregate value of these deals is US$25.5 billion – an all-time high.
  • Almost US$13 billion of this year’s crypto deals involved tech sector targets.
  • Trend reflects the hot M&A market and interest in cryptocurrencies and crypto-assets.

The adoption of crypto in dealmaking is escalating at warp speed as the digital world collides with traditional finance in spectacular fashion.

In the first three quarters of 2021, the number of M&A deals using crypto doubled the total number of these deals executed for the entire year in 2020.

In those first nine months, there were more than 575 deals either announced, closed, or pending, involving at least one party with ‘crypto’.

The aggregate value of these deals is US$25.5 billion, also an all-time high, and about half of the transactions involved tech sector targets.

This accelerating trend reflects the broader hot M&A market and signals a growing number of businesses are gravitating towards cryptocurrencies and crypto-assets.

Crypto uses blockchain technology, which despite some assertions otherwise, is highly secure, and using digital currencies gives both the vendor and the buyer some flexibility in the sale price. 

A seller could lower the asking price if the deal is paid in Bitcoin or Ethereum for example, where the hope is that the digital coin’s value will increase in the future – a plausible but potentially risky venture.

Considering Bitcoin, which was the first crypto to ever come to market, was created in 2009 the adoption of digital coins being used in dealmaking has come at rapid pace.

Online banking was only introduced in Australia in December 1995 and it took a considerable amount of time for it to be adopted by businesses and people alike.

Moving into 2022, with more exchanges, wallets, and institutions implementing digital payment processing technologies, the sector could see M&A activity spike even higher.

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