Oct 22 (Reuters) - FalconX said on Wednesday it will buy

crypto investment management firm 21shares, as the digital

assets trading firm looks to expand its exchange-traded funds

offerings.

The deal comes just over a month after Wall Street's top

regulator removed the last remaining hurdle to dozens of new

spot ETFs tied to cryptocurrencies ranging from solana to

dogecoin.

The terms of the deal were not disclosed.

The Trump administration has aligned itself with the digital

assets sector via long-awaited regulatory clarity, marking a

stark turnaround from the years of struggle and a legal battle

that paved the way for the approval of the first bitcoin ETF in

January 2024.

"We're witnessing a powerful convergence between digital

assets and traditional financial markets, as crypto ETPs

(exchange-traded products) open new channels for investor

participation through regulated, familiar structures," said

FalconX CEO Raghu Yarlagadda.

Founded in 2018 by Hany Rashwan and Ophelia Snyder, 21shares

now manages over $11 billion in assets across dozens of

products.

FalconX plans to leverage 21shares' expertise in crypto ETFs

and its brokerage platform to advance the adoption of digital

asset investment products.

Although updated standards from the Securities and Exchange

Commission are expected to unleash a flurry of crypto ETFs, the

U.S. government shutdown could curb the agency's ability to

review and approve these filings.

Concerns are also mounting over highly leveraged funds

tracking crypto and related companies. Earlier this month, the

sector saw its largest selloff ever after U.S. President Donald

Trump renewed trade tensions with China.

FalconX, which was valued at $8 billion in a 2022 funding

round, has facilitated over $2 trillion in trading volume and

has a client base exceeding 2,000 institutions.