Crypto exchange Coinbase (COIN) is working with Bybit, one of the largest crypto trading platforms, to explore ways to tokenize, custody and distribute assets such as US public and pre-IPO stocks, a person familiar with the plans told CoinDesk.
The talks, which are ongoing, do not involve any type of stake acquisition or similar deal for Bybit to enter the US, said the person, who asked to remain anonymous because they are directly involved in the discussions, dismissing a report of an investment published last month.
It makes sense for Bybit to partner with an American company, the person said, because the United States is home to certain assets that global users want. Bybit is international, while Coinbase is focused on the United States.
Working together, the two can bring American assets to a broader market, for example in Asia, depending on the person. Within five years, tokenization will bring any asset to users around the world through a single application.
“Even if Coinbase becomes a super app in the US, they will still be US-only,” the person said.
The two companies’ explorations into tokenized stocks come as other market participants explore similar linkages. Intercontinental Exchange (ICE), owner of the New York Stock Exchange, announced in March that it would acquire a stake in crypto exchange OKX. Last week, Deutsche Boerse made a strategic investment of $200 million in Kraken.
Bybit’s plan to enter the US market involves a local partner, but it is not Coinbase, the person said.
The new US-focused joint venture, said to be headed by former Bybit co-CEO Helen Liu, will involve an “unnamed local partner who will provide licensing and compliance.” Bybit will provide technology, products and liquidity.
Bybit and Coinbase declined to comment.
