CoinShares, a leading European digital asset investment firm, has successfully finalized the acquisition of Valkyrie Funds, gaining the sponsor rights to Valkyrie’s spot Bitcoin exchange-traded funds (ETFs).
Announced on March 12, this significant acquisition also includes Valkyrie Investments, the firm’s investment advisory branch, and the sponsor rights to the Valkyrie Bitcoin Fund, a physically-backed Bitcoin ETF.
The terms of the deal stipulate that the acquisition price will be determined at the conclusion of a three-year earnout period, reflecting Valkyrie’s financial performance.
Additionally, this agreement extends CoinShares’ management to include Valkyrie’s diverse ETF portfolio, such as the Valkyrie Bitcoin and Ether Strategy ETF, Valkyrie Bitcoin Miners ETF, and the Valkyrie Bitcoin Futures Leveraged Strategy ETF.
Jean-Marie Mognetti, CEO of CoinShares, emphasized the importance of the U.S. market for global asset managers and highlighted the acquisition’s strategic benefits: “The Valkyrie acquisition is yet another step in our growth strategy with a special focus this time in the U.S.
This acquisition brings an additional $530 million AUM to CoinShares, which makes it a top-line contributor from day one.
More importantly, it broadens our product offerings, strengthens our innovation capacity, and increases by a factor of 15 our total addressable market.”
In the wake of this acquisition, CoinShares plans to rebrand Valkyrie and its offerings within its ecosystem.
READ MORE: Bitcoin ETFs Will Hold Over 10% of BTC Supply By Q3
This move is part of CoinShares’ broader strategy to enhance its asset management platform in the United States, following an option to acquire Valkyrie that was held since November 2023.
The announcement arrives amidst a surge in interest for Bitcoin ETFs, notably after Bitcoin reached a new all-time high of $71,415 on March 11.
This increased attention is mirrored by the Bitwise Bitcoin ETF, which recently became the fifth fund to exceed $2 billion in Bitcoin holdings, according to Dune data, with Grayscale’s Bitcoin Trust ETF maintaining its position as the largest, managing $29 billion in Bitcoin.
Given the current pace, ETFs are expected to annually absorb 8.98% of the Bitcoin supply, potentially triggering a sell-side liquidity crisis by September, as per Ki Young Ju, founder and CEO of CryptoQuant.
Ju noted, “Last week, spot ETFs saw netflows of +30K BTC. Known entities like exchanges and miners hold around 3M BTC, including 1.5M BTC by U.S. entities… At this rate, we’ll see a sell-side liquidity crisis within 6 months.”
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