Update (June 4 at 2:37 pm UTC): This article has been updated to clarify that Monarq is a distinct entity from LedgerPrime and to include a statement from the company.

Crypto prime broker FalconX has reportedly acquired a majority stake in Monarq Asset Management’s parent company, previously owned by bankrupt exchange FTX.

According to a June 2 report from Bloomberg, the move seeks to expand the firm’s institutional client base and broaden its asset management services.

Monarq Asset Management, a Cayman Islands-registered fund formerly known as MNNC Group, was founded by former members of FTX’s LedgerPrime team, including Shiliang Tang.

Monarq was established as a new venture following the crypto exchange’s collapse in November 2022. A spokesperson for the company told Cointelegraph that Monarq is “not a continuation or rebranding of LedgerPrime,” adding that assets connected to FTX entities “were recovered in bankruptcy proceedings.” Terms of the deal between FalconX and Monarq’s parent company were not disclosed.

Founded in 2018, FalconX has moved to expand its footprint in recent months. In January, the prime broker acquired derivatives startup Arbelos Markets. In May, the company announced a partnership with Standard Chartered to scale institutional crypto banking.

FalconX reportedly views its stake in Monarq as a way to expand its institutional client base beyond hedge funds, firms, and asset managers. Benefits may include scaling quantitative models and growing the firm’s team.

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FalconX and the CFTC

FalconX says it is the world’s largest digital asset prime brokerage, executing over $1.5 trillion worth of trading volume with access to 94% of global digital asset liquidity. In May 2024, it settled with the US Commodity Futures Trading Commission (CFTC) for $1.8 million in penalties and disgorgement for allegedly failing to register with the agency.

As part of the settlement, FalconX agreed to cease offering one of its services to US residents. The company is still registered with the agency as a swaps dealer, offering financial services across multiple business lines.

In June 2022, the broker raised $150 million at an $8 billion valuation as part of its Series D financing round. Later that year, it would survive the FTX collapse. According to the broker, the exchange held 18% of its unencumbered cash equivalents.

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