Coinbase’s (Coin) $ 2.9 billion acquisition of Deribit will be a rocking point for the company pushing the US-based exchange for direct competition with global heavy weights like Binance, Wall Street analysts wrote on Thursday.

The massive deal is more than just a platform extension; It is a paradigm shift for the exchange and trading industry. According to the analysts, the agreement signalizes the start of a new consolidation cycle in the crypto trading industry as smaller exchanges face pressure and tradition companies appear to be further expanding to the sector.

Read more: In $ 2.9B Deal, Coinbase buys himself to expand on the US Crypto Options Market

Deribit controls 85% of the global crypto options market and reported $ 1.2 trillion in trading volume last year. By absorbing it becomes the coinbase the world’s largest crypto derivative platform of open interest and activity activity, Keybanc wrote in a report.

The deal also connects a geographical gap and expands Coinbase’s presence abroad, where only 20% of its revenue is currently originating, according to Barclay’s Benjamin Buddish.

Oppenheimer called it a “legitimate threat” for dominant exchanges, noting that Coinbas’s public status gave it the opportunity to finance the acquisition using stock, an opportunity not available to most private companies. This benefit combined with $ 8.5 billion in cash available could make coinbase the most aggressive consolidator in space.

Market markets are partially attractive because they offer stable quantities across market cycles. Barclays estimated deribit’s revenue in 2024 between $ 425 million and $ 450 million, suggesting a healthy earnings contribution to Coinbases bottom line.

Keybanc also highlighted the strategic fit and called Deribit’s institutional user base and international footprint a natural expansion of Coinbases futures and spot products.

Regulatory approval of the agreement remains pending, but analysts expect Coinbase to deliver more color during its first quarter earnings report on Thursday.

The exchange is expected to miss the street expectations for earnings in the first quarter as the markets were rattled by financial uncertainty. Coin shares rose 6.58% during the day, while Bitcoin rose 4.31%.

Read more: Coinbase earnings pain probably when retail activity falls, Wall Street analysts warn