After rumors swirled over the weekend, we now know that it is official: payments processing company Stripe has acquired stablecoin platform Bridge for $1.1 billion.
For Stripe, which was valued at $70 billion earlier this year, the Bridge deal marks its largest acquisition since it was founded in 2010.
Bridge was founded in 2022 to serve as an alternative payment method to compete with SWIFT and credit cards. The company’s technology allows businesses to move, store, and accept stablecoins using just a few lines of code. Companies can also leverage Bridge’s Issuance APIs to issue their own stablecoin and accept USD, EUR, USDC, USDT or any other stablecoin. After integration has taken place, companies can move money near-instantly and at a low cost around the globe.
“As we’ve gotten to know the Stripe team, it’s become clear that we both share a vision for what’s possible with stablecoins and an excitement around the opportunity to create and build this future,” said Bridge Co-Founder Zach Abrams in a LinkedIn post. “Stripe operates globally and understands better than almost anyone the problems created by our existing localized payment systems. Our teams share an excitement about stablecoins and vision for how to maximize their impact. Together, we’ll be able to solve bigger problems, support more developers, and help more consumers and businesses all across the world.”
Stripe processed $1 trillion in payment volume in 2023, a metric that places the fintech among the top payment processors in the U.S. With this influence, there are a few implications that Stripe’s Bridge acquisition holds for the U.S. stablecoin market.
Increased stablecoin adoption
Once it integrates Bridge’s technology, Stripe will be able to offer instant, low-cost settlements through stablecoins. Creating a low-cost alternative to traditional payments will make stablecoins more attractive for businesses and could lead to wider adoption in mainstream payment systems.
Cross-border payments expansion
The Bridge acquisition may enable Stripe to enhance its global payments infrastructure. This will place stablecoins as a go-to method for faster, cheaper cross-border transactions. In today’s landscape, where large, traditional players are developing new tools for cross-border payments, many still face high fees and longer settlement times. Stripe’s usage of stablecoins will help it circumvent many of those issues.
More competition
Stripe’s entry into the stablecoin space will increase competition among fintechs offering stablecoin-based payment services. The introduction of Stripe’s real-time, cross-border payment service may pressure other companies to create new offerings or improve their existing products to keep up with Stripe’s client base and new resources brought on by today’s acquisition.
Regulatory focus
As Stripe begins to use stablecoins in more traditionally regulated financial environments, it may gain the attention of U.S. regulators. This increased attention toward the stablecoin space may prompt regulators to increase enforcement efforts and could even lead to them creating clearer guidelines around stablecoin use.
Stripe’s acquisition of Bridge will position it as a key player in the stablecoin space. With Stripe’s long-standing payment processing infrastructure and global reach, once Stripe integrates Bridge’s stablecoin technology, it is poised to accelerate stablecoin adoption across mainstream payment systems.
Photo by Scott Webb