In a landmark move for the digital asset management industry, CoinShares International Limited (CoinShares) has secured an option to buy Valkyrie’s ETF business.
The firm, based on the island Jersey off the coast of France, is the leading European investment company specializing in digital assets. Valkyrie is a U.S. digital asset manager based in Nashville, Tenn. Its investment advisory business is known for actively managed cryptocurrency exchange-traded funds.
It’s an auspicious time for CoinShares to be eyeing a foothold in the U.S..
Valkyrie is one of many firms, along with BlackRock and VanEck, that’s applied to offer a spot Bitcoin ETF in the U.S.. The firm first submitted an application for a Bitcoin ETF in 2021. After being rejected, the company resubmitted an application for its Valkyrie Bitcoin Fund in June 2023.
This time around, there’s growing anticipation that the Securites and Exchange Commission has run out of reasons to say no. In fact, JP Morgan analysts reckon there’s a 90% chance that the SEC approves at least one Bitcoin ETF before January 10.
“The option to acquire Valkyrie is accelerating our expansion into the U.S. market and the deployment of our digital asset management expertise globally,” CoinShares CEO Jean-Marie Mognetti said in a press release.
The announcement marks a significant step in CoinShares’ ongoing expansion into the U.S. market, following the introduction of its hedge fund solutions division earlier this year. The launch, announced in September, marked the first time that CoinShares would be making its funds available to U.S. investors.
CoinShares has the the largest market share of European crypto exchange-traded products, overseeing more than $3.2 billion. The option to acquire Valkyrie’s ETF business is valid until the end of Q1 2024, providing CoinShares with the exclusive right to purchase 100% of Valkyrie Funds from Valkyrie Investments, along with associated rights with the Valkyrie Bitcoin Fund and other unlaunched ETFs.
As part of the agreement, the two companies have also finalized a brand licensing which would allow Valkyrie Investments to use the “CoinShares” name in its S-1 filings with the SEC during the option period.
“Together, with Valkyrie’s established U.S. presence and existing offerings, alongside CoinShares global reach and infrastructure, we’re poised to deliver groundbreaking products aimed at solving investors’ needs,” said Valkyrie CEO Leah Wald.
The final acquisition is contingent on regulatory approvals, satisfactory due diligence, and legal agreements, with Valkyrie Funds continuing to operate independently in the interim. This strategic option positions CoinShares at the forefront of bridging European expertise with the burgeoning U.S. digital asset market.
