- CoinDesk, a leading crypto news and events company, has been up for sale since January 2023 as part of Digital Currency Group’s efforts to consolidate financial resources.
- Binance Capital Management (BCM) has been exploring ways to acquire CoinDesk through its subsidiary, CoinMarketCap, but the acquisition talks are currently on hold.
- The potential acquisition price for CoinDesk is rumored to be around $75 million, significantly lower than early estimates of $300 million.
CoinDesk, a leading crypto news, and events company and a core component of the Digital Currency Group (DCG) empire, has been the talk of the town in recent weeks. The company has been up for sale since January 2023, with Digital Currency Group actively seeking buyers to consolidate financial resources. However, the acquisition talks between CoinDesk and Binance Capital Management (BCM) are on hold.
BCM, registered in the British Virgin Islands, has been exploring ways to acquire the company through its subsidiary, CoinMarketCap, a Delaware corporation. According to sources with direct knowledge of the matter, talks have been put on hold.
An article from Blockworks even suggested that initial talks between CoinDesk and Binance broke down, as the exchange anticipated a mass exodus of journalists from the news company if it became the majority owner. Despite this, Binance Capital Management has not given up on its plans to acquire CoinDesk.
Early estimates of CoinDesk’s market value ranged as high as $300 million. However, the actual acquisition price is expected to be significantly lower, according to sources cited by Blockworks, who was granted anonymity to discuss the deal. CoinDesk CEO Kevin Worth confirmed that the outlet was for sale in January, and the company had contracted with Lazard, a financial advisory firm, “to explore various options to attract growth capital to the CoinDesk business.”
The History of CoinDesk
Barry Silbert’s DCG acquired the company in 2016, three years after its launch, for around $500,000. CoinDesk became a leader in crypto news and events, culminating in the information that two of its journalists, Ian Allison and Tracy Wang, had received a prestigious George Polk Award for their financial reporting.
CoinDesk’s story on the Alameda balance sheet that exposed frailties in FTX’s financial position has been widely acknowledged as the first domino in the collapse of Sam Bankman-Fried’s empire. CoinDesk offers a fresh, unbiased perspective to industry watchers compared to media with solid ties to FTX, such as the New York Times and the Wall Street Journal.
According to one source, Binance considers CoinDesk a “significant force for good” in the cryptocurrency industry. Still, they noted that an investment in the company would be primarily driven by the fear that other investors might not step in to save the news outlet.
Concerns Over a Binance Acquisition
While the potential acquisition has sparked discussions within the industry, with some expressing concerns over the impact of ownership on CoinDesk’s editorial independence, others believe that the investment could benefit both companies and the cryptocurrency industry.
CoinDesk’s unbiased reporting and fresh perspective continue to make it a significant force in the industry. An acquisition by Binance could bring new opportunities for growth and expansion.
However, there are also concerns that an acquisition by Binance could compromise CoinDesk’s editorial independence, as Binance is one of the largest cryptocurrency exchanges in the world. Nevertheless, Binance has committed to letting CoinMarketCap operate independently, and there is no relationship between the two, even though it has been shown to have biased actions towards Binance.
It is worth noting that the cryptocurrency industry continues to evolve rapidly, with the bear market persisting. The Block recently laid off 27 employees following the disclosure of $27 million in private loans made by Sam Bankman-Fried to former CEO Mike McCaffrey, who resigned after they became public. As the industry faces challenges and opportunities, it remains to be seen what the future holds for CoinDesk and its potential acquisition by BCM.
