Finance services giant Stripe confirms acquiring stablecoin platform Bridge.
Payments processing company Stripe Inc. revealed the acquisition of the Bridge platform days after declaring it would support stablecoin. In a Monday update on X (formerly Twitter), Stripe chief executive Patrick Collison confirmed the successful acquisition.
The confirmation by the executive emerges after initial disclosures last week that Stripe had a potential deal. TechCrunch executive Michael Arrington tweeted on Sunday, October 20, that Stripe had concluded the $1.1 billion deal.
Collison references the stablecoins as room-temperature superconductors, suggesting their product fit for financial services. The update hailed stablecoins as benefiting world businesses in speed, coverage, and cost reductions in the future.
Is Stablecoin Infrastructure Next After Bridge Acquisition?
Stripe reiterated its objective of building an unmatched stablecoin infrastructure. As such, the statement expressed delight in welcoming the Bridge platform to the Stripe ecosystem.
Bridge would reveal in a subsequent update that the $1.1B deal awaits regulatory approval, though it is expected to close in subsequent months.
The acquisition joins other large takeovers executed within the crypto history. Notably, it outshines the mammoth deal by Robinhood to acquire crypto exchange Bitstamp in a $200M concluded in mid a year. Additionally, it exceeds the double value of $530M spent by investment firm CoinShares to acquire Valkyrie Funds in March. The acquisition is the largest ever executed by Stripe, with a $70B valuation in July.
It is essential to note that Bridge hardly issues stablecoins. Instead, the firm offers a software platform enabling businesses to accept stablecoin as a payment method. The firm aims to rival global payment providers Visa, Mastercard, and Swift.
The Bridge journey began in 2022, when two Coinbase ex-executives, Zach Abrams and Sean Yu, established the firm. Its website indicates the company has executed an annual payment of $5B, attracting critical clients such as SpaceX.
The acquisition arose after Stripe publicly pushed for the integration of stablecoin payments. Surprisingly, Stripe abandoned crypto support in January 2018, alleging high costs and transaction speed issues.
At the onset of October, the San Francisco-headquartered firm unveiled a new payment service dubbed ‘Pay with Crypto,’ allowing businesses to accept payments via USD Coin (USDC) from clients across 150 countries. The platform is possible following the partnership with stablecoin issuer Paxos.
Scanty details regarding the post-acquisition era are available. In particular, the management is yet to confirm whether Bridge is subject to integration into the Stripe ecosystem. Will the Bridge platform run autonomously?
The two companies are yet to provide further details about the deal. They are silent on regulatory considerations and compensation perks for staff holding equity. Attempts to contact Stripe have been unsuccessful since the management has yet to offer an official statement.
The acquisition deal occurs a few months after Bridge realized $40M in the August Series A funding round. The August 2024 round attracted several venture capital firms, including Index, Sequoia, Haun Ventures, and Ribbit Capital.
Stripe All-In Crypto
Stripe has hinted at going all-in on digital assets this year. A review of the recent activities reveals Stripe-Avalance Network integration in April. The integration would facilitate the native wallet Core, which utilizes Stripe’s fiat-to-crypto on-ramp services.
In June, Stripe would strike a deal to integrate Base, a Coinbase Layer 2 network, within the crypto payout products. The June 2024 integration will allow Stripe users to acquire digital assets within the Coinbase Wallet via credit cards and Apple Pay.
The news of Stripe acquiring Bridge comes as other players with established footing within the traditional finance eye maiden entry into the stablecoins. Earlier, European banking company Revolut teased unveiling stablecoins. Trading specialist Robinhood harbored similar objectives.
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