Fintech company Stripe is reportedly in talks to acquire startup Bridge for a price tag of $1 billion, according to sources familiar with the discussions. The acquisition, if finalized, would be the largest to date for Stripe, which is currently valued at $70 billion. However, regulatory considerations and compensation for employees, including Bridge founders Zach Abrams and Sean Yu, could potentially pose hurdles to the deal.
Bridge, a provider of infrastructure for crypto stablecoins, has raised a total of $58 million in funding, with a recent Series A round valuing the company at $200 million. The $1 billion valuation being discussed for the acquisition would signify a significant increase in value for Bridge. The company offers software that enables businesses to accept cross-border payments made with stablecoins and has processed over $5 billion in annualized payment volume. Some of its customers include government departments like the U.S. State Department and companies like SpaceX and Coinbase.
Founders Zach Abrams and Sean Yu are well-known entrepreneurs in the crypto and payments space, with past experience at companies such as Coinbase, Brex, DoorDash, and Airbnb. They previously built a Venmo competitor called Evenly, which was eventually sold to Block in 2013. The duo launched Bridge in 2022 and have attracted investments from prominent firms such as Sequoia, 1confirmation, Index Ventures, and Ribbit.
Stripe, which had briefly halted crypto payments in 2018 before restarting them in October, aims to utilize the acquisition of Bridge to expand its offerings in stablecoins. Stablecoins are cryptocurrencies pegged to another asset, such as a national currency, and have a combined market cap of over $170 billion. The acquisition would provide Stripe with the infrastructure needed to further explore this sector and potentially offer more efficient payment options to consumers.
Stripe has made a number of undisclosed acquisitions in recent years, including TaxJar and Lemon Squeezy in 2021. The company also recently introduced a new feature called “Pay with Crypto,” which integrates stablecoins into its checkout process and charges a 1.5% transaction fee. According to Stripe president Will Gaybrick, stablecoins could be a more efficient way to make payments, especially for customers outside the U.S. While Gaybrick did not confirm the acquisition of Bridge, he emphasized that Stripe is heavily investing in stablecoins and exploring their potential as a means of payment.
Overall, the potential acquisition of Bridge by Stripe highlights the fintech company’s interest in expanding its presence in the booming stablecoin market. With the global market for stablecoins continuing to grow, this move could position Stripe as a key player in facilitating cross-border payments and offering innovative payment solutions to its customers. While the deal is still under discussion and subject to various factors, it could significantly impact the future growth and direction of both companies in the evolving world of digital finance.
