(Bloomberg) -- Digital-asset trading and brokerage firm FalconX is in advanced talks to acquire Arbelos Markets, a derivatives startup launched in 2023 by a pair of crypto industry veterans.
The transaction will be financed through a mix of cash and FalconX stock, and is expected to be announced in the coming days, according to people familiar with the deal, who asked not to be identified as the discussions are private. It is unknown how the transaction will value Arbelos.
A representative for FalconX declined to comment.
The acquisition comes after forecasts that pro-crypto President-elect Donald Trump’s return to the White House will herald a flurry of digital-asset mergers. Trump, once a crypto skeptic, has vowed to make America a linchpin for the digital asset sector and appoint regulators with a friendly stance toward the asset class.
FalconX Co-Founder and Chief Executive Raghu Yarlagadda said in October that he expected a “wave of consolidation” in the sector, adding that the company would actively hunt for acquisition targets.
Stripe Inc.’s $1.1 billion swoop for stablecoin startup Bridge, just a few weeks before Trump’s election victory, has been viewed as another signal that deal-making in the sector may heat up.
Arbelos, a crypto derivatives liquidity provider, announced a $28 million raise led by Dragonfly Capital in May 2024. FalconX was among the investors in the round, alongside Circle Ventures, Deribit, Paxos and StarkWare.
The startup’s founders, Joshua Lim and Shiliang Tang, are bankers-turned-crypto-traders. Lim previously led trading desks at Galaxy Digital and Genesis Global Trading, while Tang was formerly chief investment officer at LedgerPrime, which now operates as MNNC Group.
Founded in 2018, San Mateo, California-based FalconX was last valued at $8 billion when it raised $150 million in 2022. It’s backed by investors including Tiger Global, GIC and B Capital.
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