Crypto exchange Abra is reportedly buying some funds from digital asset management firm Valkyrie Investments after reaching a settlement with US state regulators.
According to a new one report by Bloomberg Abra bought several Valkyrie trusts after settling with 25 regulators.
Marissa Kim, Abra’s head of asset management, tells Bloomberg that the deal also included Valkyrie’s Tron and Zilliqa trusts, which together sold about $71 million in assets to investors.
Also included in the deal are Valkyrie funds that have not yet been rolled out.
As Kim told Bloomberg:
“This acquisition will provide that [Abra] with a way to expand its current offering of spot and DeFi (decentralized finance) products to a new audience of investors.”
In 2023, the state of Texas accused Abra of misleading investors through the sale of two interest-bearing crypto products, while also claiming that the crypto exchange was insolvent or nearly insolvent, according to the report.
In June, Abra organized with a working group of states including Arkansas, Connecticut, Georgia, Ohio, Oregon, Texas, Vermont and Washington State. The task force launched an investigation into the company and found it was operating without proper licenses, according to a press release from the Conference of State Bank Supervisors (CSBS).
According to the CSBS, Abra was fined $250,000 per jurisdiction and will refund customers up to $82.1 million in crypto assets.
As stated by CSBS President Charlie Clark:
“State financial regulators are taking their role to protect consumers and take unlicensed activity seriously. Companies that do not operate within the boundaries of state law will be held accountable.”
Earlier this year, digital asset manager Valkyrie Funds was acquired by European digital investment group CoinShares after the US Securities and Exchange Commission (SEC) approved its bid to create a spot Bitcoin (BTC) exchange-traded fund (ETF).
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