eToro Acquires ZenGo for $70 Million: Traditional Finance Embraces Self-Custody
📋 En bref (TL;DR)
- eToro acquires ZenGo for $70 million — the seedless crypto wallet built on MPC technology
- ZenGo: 2 million users across 180 countries, zero hacks since 2018
- MPC technology: the private key is split into two separate parts, never reassembled. No need for a 24-word recovery phrase
- eToro (Nasdaq-listed, 40 million users) plans to integrate DeFi: tokenized assets, prediction markets, yield products
- Strong signal: traditional finance is now buying DeFi infrastructure instead of building it
- ZenGo stays separate from eToro’s MiCA license — a deliberate architecture to offer DeFi access without regulatory constraints
Traditional finance isn’t just watching crypto from the sidelines anymore. It’s buying it. On April 15, 2026, eToro — the Nasdaq-listed trading platform with 40 million users — announced the acquisition of ZenGo, the seedless MPC crypto wallet, for approximately $70 million.
This is one of the first major cases where a regulated financial platform directly acquires DeFi infrastructure. The signal is clear: “self-custody” is no longer a crypto niche. It’s a product institutions want to own.
ZenGo: the wallet that eliminated the recovery phrase
Founded in 2018 in Tel Aviv by Ouriel Ohayon, Tal Be’ery, and Omer Shlomovits, ZenGo pioneered a technology called MPC (Multi-Party Computation). The concept: instead of storing your private key in a single location, it’s split into two separate parts.
The first part is stored on your phone. The second is on ZenGo’s servers. When you make a transaction, both parts collaborate mathematically to sign — without ever reassembling the full key. Result: no seed phrase (those 12 or 24 words you absolutely cannot lose).
Recovery uses a 3-factor system: email, a recovery file in your cloud storage, and 3D facial recognition. An attacker who obtains two of these three elements still cannot access the account.
The numbers speak for themselves: 2 million users across 180+ countries, over 1,000 supported cryptos, and most importantly zero hacks in 8 years. The wallet has been audited by Kudelski, AppSec, Scorpiones, and CertiK.
Why eToro is buying a crypto wallet
Yoni Assia, eToro CEO, summarizes the strategy: “We believe the future of finance will be increasingly digital, decentralized, and user-controlled. Self-custody is an important part of that evolution.”
Specifically, eToro plans to use ZenGo’s technology to open its 40 million users to:
- Tokenized assets (stocks, bonds, real estate on the blockchain)
- Prediction markets (eToro already integrated Polymarket in late 2025)
- Yield products (staking, DeFi lending)
- Decentralized perpetual trading
eToro stock (ETOR) jumped 5% on the announcement and 18% for the week. The timing is strategic: the deal closed while the crypto market was down 40% from its October peak — the classic window for discounted acquisitions.
A clever regulatory architecture
The most interesting detail of this deal is regulatory. eToro holds a MiCA license (Europe’s crypto regulatory framework) through its Cypriot subsidiary. But ZenGo is deliberately placed outside this regulatory perimeter.
MiCA doesn’t regulate self-custody or direct DeFi interactions — only centralized service providers. Users accessing DeFi protocols via ZenGo interact directly with the protocols, without eToro executing trades or holding assets.
It’s described as “the only viable architecture for a MiCA-licensed platform that wants to offer on-chain access without importing regulatory liability.” With the MiCA compliance deadline of July 1, 2026, this structural decision makes perfect sense.
The wallet market in full transformation
The eToro-ZenGo deal sits within an exploding crypto wallet market. Valued at $12.6 billion in 2024, it could reach $100.8 billion by 2033 (26.3% annual growth).
Competition is fierce. Trust Wallet counts 140+ million users, MetaMask 22 million, and Phantom dominates on Solana. Tether even launched its own wallet on April 14 — the day before the eToro-ZenGo announcement.
But the real signal from this acquisition goes beyond the wallet market. 2026 marks the year of TradFi-DeFi convergence. Until now, crypto M&A stayed between native players. When a Nasdaq-listed broker buys a DeFi wallet to offer on-chain access to its millions of clients, it’s a paradigm shift.
Glossary
- MPC wallet: a crypto wallet using Multi-Party Computation to split the private key into multiple fragments. No single fragment can access the funds alone. Eliminates the need for a seed phrase.
- Self-custody: a storage mode where the user directly controls their private keys, without an intermediary. Opposite to “custody” where a platform holds your keys.
- Seed phrase: a sequence of 12 or 24 words used to restore a crypto wallet. Losing it means permanently losing access to funds. MPC technology eliminates it.
- MiCA (Markets in Crypto-Assets): a European regulation governing crypto service providers. Effective since 2024, it requires licenses and compliance obligations.
- Tokenization: the process of representing a real-world asset (stock, bond, real estate) as a digital token on a blockchain. Enables fractional ownership and 24/7 trading.
Frequently Asked Questions
Frequently Asked Questions
What is ZenGo and why is eToro buying it?
ZenGo is a seedless crypto wallet using MPC technology to secure funds. eToro is acquiring it to integrate self-custody and DeFi access into its platform of 40 million users. Choosing a crypto platform
Is MPC technology safer than a seed phrase?
MPC eliminates the single point of failure of a seed phrase. The private key is split into independent fragments. A hacker would need to compromise both your phone AND ZenGo’s servers simultaneously — which has never happened in 8 years.
What will change for eToro users?
In the short term, nothing. In the medium term, eToro plans to integrate the ZenGo experience to offer direct DeFi access: tokenized assets, prediction markets, yield products, and decentralized trading.
What is self-custody and why does it matter?
Self-custody means you directly control your private keys. Your funds don’t depend on any platform. If an exchange goes bankrupt (like FTX), your crypto is safe. Avoiding crypto scams
Does this deal impact MiCA regulation?
ZenGo deliberately operates outside eToro’s MiCA perimeter. MiCA doesn’t regulate self-custody. This architecture allows eToro to offer DeFi access without additional regulatory liability.
Sources
This article is based on the following sources:
- eToro — Official press release: eToro Acquires Zengo
- CoinDesk — eToro to acquire crypto wallet Zengo in $70 million deal
- Decrypt — eToro Acquires Self-Custody Crypto Wallet Firm Zengo for $70 Million
- Calcalist — eToro acquires crypto wallet provider Zengo for $70 million
- CoinLaw — eToro Expands Crypto Strategy With $70 Million Zengo Wallet Deal
How to cite this article:
Fibo Crypto. (2026). eToro Acquires ZenGo for $70 Million: Traditional Finance Embraces Self-Custody. Retrieved April 16, 2026 from https://fibo-crypto.fr/en/blog/etoro-acquires-zengo-mpc-wallet-self-custody
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