Stripe is currently in the process of negotiating a $1 billion acquisition of Bridge, a stablecoin startup, which would be its most significant transaction to date.
Bridge, a crypto stablecoin startup, is presently in negotiations with Stripe to acquire the company for $1 billion.
The fintech unicorn would make its largest acquisition just months after Stripe cofounder John Collison declared, “Crypto is back.”
Bridge, a company that provides a stablecoin infrastructure, has recently raised $58 million, including a $40 million Series A round that valued the company at $200 million. It also sparked interest in a potential Series B raise at a higher valuation.
Nevertheless, Bridge’s owners, Zach Abrams and Sean Yu, may face regulatory challenges, such as compensation and licenses.
Stripe suspended cryptocurrency payments in 2018 as a result of exorbitant fees and technical difficulties, despite its $70 billion valuation. Nevertheless, the organization has recently implemented a novel “Pay with Crypto” feature. The service includes stablecoins in its purchasing service and charges a 1.5% transaction fee.
“We internally quip that the main app for cryptocurrency is merely money,” stated President Will Gaybrick. Paxos, the company that issued Binance USD (BUSD), recently launched a new payments platform. Stripe has become the first client of the platform.
Bridge’s cross-border payments solutions have conducted over $5 billion in annualized payments and have a client list that includes the US State Department, US Treasury, SpaceX, and Coinbase. Among its investors are 1confirmation, Bedrock, Haun Ventures, Index Ventures, Oak HC/FT, and Ribbit.
Block acquired Evenly, a competitor to Venmo, from Abrams and Yu in 2013. Abrams and Yu each held significant positions at Coinbase and Brex prior to the establishment of Bridge in 2022. Yu also worked at DoorDash and Airbnb.
Stripe’s acquisition of Bridge would fortify its position in the stablecoin market, which has a market capitalization of $170 billion.
Recent reports have demonstrated a new record-breaking increase in the number of stablecoin transactions. The liquidity of stablecoin reached an all-time high of $169 billion at the end of last month, a 31% increase from the beginning of the year.
USDT, Tether’s cryptocurrency, maintained its market leadership by increasing its market capitalization by $28 billion to nearly $120 billion, with a market share of 71%.
Circle’s USDC also underwent substantial growth, with its market capitalization increasing by $11 billion to $36 billion year-to-date, representing a 44% year-to-date increase. This led to the company acquiring 21% of the market share.
Earlier this week, Tether announced its intention to explore lending opportunities in the commodities trading sector. This new venture is a direct result of the company’s record-breaking profits, which amounted to $5.2 billion in earnings for the first half of 2024.
Also Read: Bitwise CIO Projects Bitcoin Will Reach a Six-Figure Price in 2025, Calling It “Exceptional”
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