Vancouver-based fintech Embed is being acquired by Chicago-based crypto exchange FTX US. Terms of the deal were not disclosed.
This deal marks the second major acquisition for Embed founder and CEO Michael Giles since 2019. He previously founded Third Party Technologies. which was acquired by Square — now Block Inc. — and rolled into the Cash App.
Embed is a financial infrastructure platform that allows customers to add stock trading to their own products. The company's subsidiary broker-dealer Embed Clearing LLC received clearing and custody approvals from the National Securities Clearing Corp. and the Depository Trust Co.
It is also an approved member of the Nasdaq Stock Market. Embed Clearing is registered with the Securities and Exchange Commission and a Financial Industry Regulatory Authority broker-dealer.
This acquisition continues FTX US' strategy to reach across asset classes for retail cryptocurrency and traditional securities brokerage accounts.The deal launched as a partnership between the companies before the M&A talk began. FTX was one of Embed’s first clients.
"Our goal at FTX is to provide a comprehensive trading application that spans all asset classes,” said FTX US President Brett Harrison, in a written statement. “For equities and options trading this necessarily includes services such as clearing and custody, and our partnership with Embed showed us that they have built excellent technology and infrastructure to provide these services.”
In a LinkedIn post, Giles said he will be sticking around following the deal to lead the business. Embed will also continue with its goal to whitelabel its technology to make it easier for other businesses and applications to add trading.
“Our teams have a shared vision and dedication to building from the ground up to democratize access to financial services, and Embed's latest securities technology is the ideal complimentary to FTX's leading crypto solutions,” said Giles in a written statement. “This combination enables the combined group to bring an industry-leading securities and crypto solution to market, which was previously sorely lacking, for the benefit of FTX US customers and exciting new B2B clients.”
Embed was founded in 2020 and has raised a total of $80 million from investors. Its last infusion was in fall 2021. The company had planned to hire this year, expecting to grow from around 30 employees to 60.
