eToro Group has entered into an agreement to buy crypto wallet startup Zengo, as the investment and trading platform looks to expand its digital asset offering.
According to a Bloomberg report, the transaction is valued at around $70m and is largely cash-based.
Go deeper with GlobalData
Access deeper industry intelligence
Experience unmatched clarity with a single platform that combines unique data, AI, and human expertise.
Zengo, founded in 2018, focuses on multi-party computation (MPC) cryptography and provides a self-custodial crypto wallet. The product is used to buy, sell, swap and manage cryptocurrencies. It also supports token-to-fiat swaps, staking and access to decentralised finance applications.
In a statement, eToro said the deal will combine its multi-asset platform and distribution with Zengo’s non-custodial wallet technology. The company said this will support Zengo’s “next phase of growth” while increasing eToro’s digital asset capabilities.
eToro also expects the acquisition to strengthen its ability to support “evolving digital asset use cases”, including tokenised assets and decentralised trading models such as prediction markets and perpetuals.
eToro co-founder and CEO Yoni Assia said: “We believe the future of finance will be increasingly digital, decentralized and user-controlled. Self-custody is an important part of that evolution.
“Zengo has built an innovative and secure wallet experience, and this acquisition will enable us to accelerate Zengo’s growth while continuing to provide users with choice in how they access digital assets.”
The company said there will be no immediate impact on eToro users. It plans to integrate the Zengo and eToro user experience in the near future.
Once complete, eToro users will gain access to decentralised products including prediction markets, perpetuals and yield products.
Zengo co-founder and CEO Ouriel Ohayon said: “Joining eToro allows us to accelerate that mission at a global scale. Together, we can expand access to self-custody and on-chain finance while connecting it to a broader investing ecosystem that bridges traditional and on-chain finance.”
The agreement follows eToro’s comments in September that it intended to pursue more significant merger and acquisition activity. The company indicated that future targets could help it add asset classes and expand into additional geographies.
eToro ended last year with around $1.3bn in cash and cash equivalents. The company raised nearly $620m in its initial public offering (IPO) in May.
