Crypto trading company FalconX is set to acquire 21Shares, but the details of the deal remain unknown.
FalconX aims to develop crypto funds based on derivatives and structured products.
21Shares manages over 50 listed exchange-traded products with $11 billion in assets.
Crypto trading broker FalconX is set to acquire asset manager 21Shares, as reported by the Wall Street Journal on Wednesday. The deal will see 21Shares merge with FalconX, paving the way for product expansion.
FalconX acquires 21Shares to expand product suite
The deal, whose details remain undisclosed, will allow FalconX to expand its product line in the industry beyond market-making services and liquidity provision, into crypto exchange-traded funds (ETFs).
Executives of both firms said that the merger will focus on developing crypto funds based on derivatives and structured products.
21Shares is one of the most prominent providers of crypto Exchange Traded Products (ETPs), with over 50 listed offerings managing over $11 billion in assets.
Although the terms of the deal remain undisclosed, it was completed using a blend of cash and equity.
On the other hand, FalconX, the crypto trading broker co-founded by Raghu Yarlagadda in 2018, has facilitated over $2 trillion in cryptocurrency transactions for more than 2,000 institutional clients.
FalconX’s expansion into crypto ETFs follows key milestones in the regulatory landscape, including the passing of the GENIUS Act in the United States (US). The US Securities & Exchange Commission (SEC) and other agencies have promised to formulate a progressive regulatory framework that supports innovation while protecting the interests of stakeholders and customers.
Crypto ETPs are financial products that allow exposure to cryptocurrency prices by tracking spot and futures directly on stock exchanges. The approval of Bitcoin spot ETFs in January 2024 significantly changed the outlook of the cryptocurrency market, making Bitcoin attractive to institutional traders as a maturing asset.
