Highlights:
- Stripe acquires stablecoin platform Bridge for $1.1 billion, its largest deal to date and increasing its expansion into cryptocurrency presence.
- Launched by former Coinbase employees, Bridge focuses on payment operations within stablecoins, thus improving Stripe’s cross-border and digital transactions.
- Bridge’s technology can help Stripe compete with existing solutions like SWIFT, pursuing its dominance in payments worldwide.
Payment processing giant Stripe has acquired the stablecoin platform Bridge in a $1.1 billion deal, marking the company’s largest investment into the cryptocurrency space to date. Though neither business has verified the deal, which was initially revealed by TechCrunch founder Michael Arrington on his X account, it is widely believed to be completed.
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This deal is done. $1.1b https://t.co/J7ppK4uHw0
— Michael Arrington 🏴☠️ (@arrington) October 20, 2024
Stripe’s Bold Move into Stablecoins
San Francisco and Dublin-based Stripe was valued at $70 billion in July. It provides services in online payment solution for companies around the world that contributes a total of 1% of the world’s total GDP. Stripe is increasing its capability when it comes to stablecoin payments through the acquisition of Bridge. It seeks to act as an enabler to enhance the efficiency of cross-border transactions.
Earlier this year, Stripe announced it would accept international stablecoin payments. Stripe integrated Circle’s USD Coin (USDC) into its payment interface, allowing businesses to accept and send stablecoins. Moreover, the company’s president, Will Gaybrick, pointed out that with its help, stablecoins can be used as efficient instruments of payment, especially as far as clients from the rest of the world are concerned.
Crypto is back. @Stripe will start supporting global stablecoin payments this summer. Transactions instantly settle on-chain and automatically convert to fiat. Join the waitlist https://t.co/hws2OsU3Id and watch the demo (h/t @Solana) from Sessions. pic.twitter.com/zGKYW2FM6i
— John Collison (@collision) April 25, 2024
Adding to this, Bridge’s acquisition helps Stripe vastly diversify its stablecoin catalog. Stripe’s commitment to digital assets is evident by its acquisition of the stablecoin platform Bridge. Stripe has been using Bridge’s technology to compete against more traditional models like credit card or SWIFT platforms.
Furthermore, it also enables Stripe to offer firms solutions that enable the creation, storage, transfer, and receipt of stablecoins. Therefore, Stripe provides its users worldwide with more opportunities for payment processing.
Bridge’s Role in Cross-Border Payments
Bridge was founded in 2022 by Zach Abrams and Sean Yu, both former Coinbase employees. Abrams previously served as Head of Consumer at Coinbase and founded Evenly, a payments company owned by Square. Live, open-source streamer Yu has previously been an engineer at Coinbase, Square, DoorDash, and Airbnb.
Bridge is an open system for transactions based on stablecoins that allow seamless transactions across borders. The network would allow companies to receive payments from more than 70 countries using stablecoins linked to conventional money. This policy reduces the use of conventional banking systems, which involve a lot of time and money. Moreover, Bridge provides security for technological international transactions.
Before the acquisition, Bridge raised $58 million from Sequoia Capital, Ribbit Capital and Index Ventures. The payment platform startup was estimated to be worth $200 million and had more than $5 billion in payment volume annually. Its clients were the US State Department, the US Treasury, SpaceX, Coinbase and many others. Thus, Bridge became one of the market leaders in the circulation of stablecoins.
Impact on the Crypto Industry
The $ 1.1 billion takeover is the largest in the field of cryptocurrencies. It surpasses earlier massive deals such as CoinShares’ $530 million deal to acquire Valkyrie Funds and Robinhood’s $200 million acquisition of Bitstamp. This breakthrough shows that the role of stablecoins will only increase in the international financial industry.
Stripe’s acquisition expands its menu and provides more efficient cross-border payment options. By integrating with Bridge’s stablecoin network, Stripe can provide faster and more accurate transactions globally and, therefore, outcompete other players in the global payments market.
Paxos recently rolled out a new stablecoin payment solution, and Stripe was the first to integrate it for international operations. The solution directly converts USD to a stablecoin of platforms like the PYUSD, USDP, and USDCs. It manages payments, refunds, and payouts, and it is ideal for multi-enterprises.
Introducing our new Paxos Stablecoin Payments platform! We've made it easier than ever for payments platforms and businesses to accept stablecoin payments with:
✅ Faster settlement
✅ Streamlined onboarding
✅ Instant conversion between USD and USDP, PYUSD, and USDCWe’re…
— Paxos (@Paxos) October 15, 2024
The infrastructure allows on-chain transactions by Ethereum, Solana, and Polygon, hence efficient blockchain dealing. This partnership seeks to enhance the efficiency and affordability of international transactions using such currencies. In light of this, Pay with Crypto is yet another feature of Stripe that will allow merchants to accept stable coins for payment to facilitate international transactions easily.
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