FalconX, the institutional crypto-prime broker, has agreed to acquire 21Shares, a prominent crypto asset manager known for its exchange-traded funds (ETFs), according to a report by the The Wall Street Journal. The companies did not disclose the financial terms of the transaction, but regulatory filings indicate it will be funded through a combination of cash and equity.
Founded in 2018, FalconX has processed over $2 trillion in trades and serves more than 2,000 institutional clients, while 21Shares boasts over $11 billion in assets across more than 50 listed crypto-ETPs.
The acquisition reflects a strategic move by FalconX to expand beyond market-making and liquidity services into issuing crypto funds and structured products.
According to FalconX CEO Raghu Yarlagadda, the combined entity will bring “crypto flows into traditional wrappers” faster and with broader institutional reach.
Analysts say this aligns with a broader uptick in institutional crypto-fund issuance, driven by eased regulatory pathways for crypto-ETFs and rising demand for regulated exposures.
What It Means for the Market
For institutions, this signals a deepening of crypto infrastructure, the ability to trade, custody and invest in digital assets through regulated funds rather than direct spot holdings. Observers suggest the deal could also accelerate FalconX’s route to a U.S. IPO.
Meanwhile, 21Shares’ expertise in fund issuance gives FalconX an immediate foothold in the ETF space, potentially enabling it to launch new digital-asset products in months rather than years.
From a market-structure view, the consolidation underscores crypto’s shifting landscape, from standalone trading platforms toward vertically integrated services that combine trading, custody, fund-management and regulated distribution. The deal is being viewed as part of an ongoing wave of M&A in the digital-assets space, driven by regulatory clarity and institutional appetite.
While the full rollout of new products is still months away, this acquisition marks a major step in crypto’s evolution toward mainstream financial markets.