Transaction Overview
On October 16th, 2024, CoinDesk, a crypto-focused media company, announced its acquisition of CCData, an institutional crypto data provider, and their retail data aggregator, CryptoCompare, for an undisclosed valuation.
Target: CCData & CryptoCompare
Founded in 2014, CCData was one of the first companies to identify quality exchange volume data that differentiated between what was real and fake, thus becoming the industry standard. Their data offering covers over 7,000 digital assets, 300 exchanges, and 40 billion data calls per month. They also offer a liquid digital indices product that tracks $4B in AUM across 250 investable indices through VanEck, SGX, and Nomura. Lastly, they offer institutional research and an API call that taps into 300+ exchanges and 300,000 digital asset pairs to help inform institutional traders.
The company’s client base spans over 500 regulators, asset managers, and banks such as JP Morgan, Refinitiv, Coinbase, MSCI, SIX, 21Shares, ETC Group, and SGX among others.
According to FCA filings, CCData had revenues of $4.0M, $3.3M, and $2.5M in 2023, 2022, and 2021 respectively. In 2023 the firm had $261K in profits.
Founded in 2014 and based in London, CCData has around 70 employees. The company had raised $9.3M over three funding rounds and two angel investments. In January 2024, the company raised $2.5M from MV Index Solutions, putting the company’s post-money valuation at $41M. Other investors included VanEck and Cadenza Capital.
CryptoCompare, founded as the retail arm of CCData, serves around 300,000 users, offering real-time and historical data on digital assets, including prices and trading volumes, along with tools like crypto indices, portfolio tracking, and analytics. The platform supports individual and institutional clients, aiming to provide accurate and reliable data for trading, investment, and research needs.
CCData main competitors include Amberdata, Lukka, CoinGecko, CoinMetrics, Messari, Kaiko, and CoinMarketCap.
Buyer: CoinDesk
CoinDesk is a crypto-focused media platform that has three core businesses. 1) A content producer that publishes articles and research on the crypto industry, 2) An indices business that benchmarks tracks $8B in trading volume, and 3) An event organizer that puts on the Consensus conferences.
Based in NYC and founded in 2013 by Shakil Khan, CoinDesk now has over 150 employees. The company was first acquired by Digital Currency Group in 2016, and was recently acquired by crypto exchange Bullish, in November 2023 for $75M in an all-cash transaction.
CoinDesk, in January 2021, had previously acquired TradeBlock, a market analytics, order management, execution, and compliance automation tool, where it kept the index data (now CoinDesk Indices) and spun out and eventually closed the remainder of the business.
CoinDesk reportedly had $50M in revenue in 2022 and before its acquisition by Bullish brought in $24M in Q1-Q3 2023, or an annualized $32M.
Similar trends were seen in their web traffic, according to Semrush, CoinDesk had 3.5M monthly visitors in the last month, while it had 13.2M and 4.1M in December 2022 and September 2023, respectively.
Transaction Parameters
CoinDesk closed on the acquisition of CCData and CryptoCompare for an undisclosed amount.
Previous comparable transactions include: Binance | CoinMarketCap (M&A Alert), Lukka | Coinfirm, Amberdata | Genesis Volatility, Blockdaemon | Anyblock Analytics, Morningstar Ventures | CoinFYI
Strategic Rationale
This acquisition creates CoinDesk’s digital asset data business, which enhances their index business and allows for increased depth of data for their media business.
Additionally, CoinDesk will acquire CryptoCompare’s 300,000 active retail users, driving new subscriptions and cross-selling opportunities.
Architect Partners’ Observations
In an industry that is defined by every transaction being trackable, data matters. CoinDesk operates a media and indices business that both rely heavily on market data of third parties and made the clear decision that owning and controlling access to that dataset is a requirement.
As the data and data analytics sub-sector within crypto matures, we expect similar transactions to play out as groups come to similar conclusions as CoinDesk. Historically, data and data analytics created multibillion dollar companies in traditional finance with groups like Refinitiv, S&P Global, FICO, etc. As the crypto industry matures, the data tracking transactions and flows will become increasingly more important to drive investment decisions.
Sources
PitchBook, CCData Press Release, CoinDesk Press Release, CCData Website