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FalconX Acquires 21shares to Strengthen Crypto ETF Business Amid Expanding Market

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FalconX, a leading digital assets trading firm, announced on Wednesday that it will acquire crypto investment manager 21shares for an undisclosed amount, marking a major expansion into the exchange-traded funds (ETF) market as cryptocurrency investment vehicles gain momentum globally.

The acquisition comes just weeks after the U.S. Securities and Exchange Commission (SEC) cleared the last hurdles for a wave of new spot cryptocurrency ETFs, extending beyond bitcoin and ether to assets like solana and dogecoin.

Founded in 2018 by Hany Rashwan and Ophelia Snyder, 21shares manages over $11 billion in assets across multiple crypto investment products. The company is known for pioneering exchange-traded products that give traditional investors regulated access to digital assets.

FalconX, which reached an $8 billion valuation in a 2022 funding round, has facilitated more than $2 trillion in trading volume and serves over 2,000 institutional clients worldwide. The firm said it will use 21shares’ ETF experience and brokerage infrastructure to accelerate the development of regulated crypto investment products.

“With the SEC streamlining listing pathways, this sets them up to be both the pit crew and the driver as the market moves beyond only bitcoin and ether wrappers,” said Michael Ashley Schulman, chief investment officer at Running Point Capital Advisors.

Analysts say the deal positions FalconX at the forefront of the next wave of crypto ETFs, which are expected to diversify into multiple tokens as the market matures. However, potential challenges loom, including a possible U.S. government shutdown that could slow ETF approvals, and volatility following renewed U.S.-China trade tensions that recently triggered the crypto sector’s largest selloff ever.

By combining FalconX’s institutional trading reach with 21shares’ ETF management expertise, the merger could create one of the strongest players in the crypto-finance ecosystem, bridging the gap between traditional finance and digital asset innovation.

Japan Weighs Allowing Banking Groups to Offer Crypto Trading Services

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Japan’s Financial Services Agency (FSA) is considering a major regulatory shift that would allow banking group subsidiaries to launch cryptocurrency trading services, according to a report by Nikkei on Wednesday. The move aims to expand market access and boost competition in Japan’s fast-growing digital asset industry.

Currently, subsidiaries of banking groups are barred under the Banking Act from registering as crypto asset service providers. The proposed revision would enable securities subsidiaries of banking groups to handle crypto trading, putting them on an even playing field with existing operators tied to securities companies, such as Rakuten Wallet and SBI Holdings’ crypto unit.

The FSA is also reportedly reviewing the long-standing ban on banks investing directly in cryptocurrencies, potentially allowing financial institutions to buy and hold crypto assets as part of their portfolios.

Officials have emphasized that any regulatory changes will be accompanied by strict consumer protection rules, requiring bank-affiliated firms to clearly explain the volatility and risks of crypto investments to retail investors.

The proposed reforms come as Japan seeks to strengthen its position as a regulated global crypto hub, balancing innovation with investor safety. The FSA has not yet issued an official comment, but the policy shift could reshape Japan’s financial sector by integrating traditional banking and digital asset markets more closely than ever before.

Florida Attorney General Investigates Robinhood Crypto Over Low-Cost Trading Claims

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Florida Attorney General James Uthmeier has initiated an investigation into Robinhood Crypto, scrutinizing whether the platform misled users by advertising itself as the cheapest option for buying cryptocurrencies. The AG’s office announced on Thursday that it has issued a subpoena to Robinhood Crypto, a division of Robinhood Markets, seeking internal documents related to potential breaches of Florida’s Deceptive and Unfair Trade Practices Act.

Uthmeier emphasized the need for transparency in cryptocurrency transactions, stating, “When consumers buy and sell crypto assets, they deserve transparency in their transactions.” He added that Robinhood’s longstanding claim of being the “best bargain” appears to be deceptive.

Robinhood allows customers to trade stocks and cryptocurrencies without charging direct commissions. Instead, the company earns revenue by routing orders to third-party firms that pay Robinhood, a practice known as payment for order flow (PFOF).

In response, Robinhood’s General Counsel Lucas Moskowitz said the company provides clear pricing information throughout the trading process, including details on spreads, fees, and Robinhood’s revenue from trades. He defended Robinhood’s position as a platform offering “crypto trading at the lowest cost on average.”