The goalkeeper has penned a two-year contract with Shrewsbury following his release into the free agent pool.
Halstead came through the ranks at Bloomfield Road but has been allowed to move on after finding first-team opportunities hard to come by.
The 23-year-old is not overly concerned at having had to find himself a new employer, with the professionalism at Blackpool questioned as he makes his way through the exits.
Halstead told Shrewsbury’s official website: “At the end of last season Blackpool decided not to keep me on, which was a bit of a shock.
“It’s taken a little time but I’m glad to finally have it all sorted and glad to be at Shrewsbury.
“It looks to be a brilliantly run club and compared to Blackpool it seems to be much more professional and looks to be a club going places.
“Obviously relegation (into League Two) wasn’t ideal but, with the way the manager’s thinking and the philosophy he’s got on the game, I fully expect us to be challenging for promotion.
“I know there are already a couple of good young keepers here and I look forward to working with them.”