Anchorage Digital Acquires Mountain Protocol as USDM Stablecoin Winds Down

Anchorage Digital, the only federally chartered crypto bank in the U.S., has acquired stablecoin issuer Mountain Protocol in a strategic move to expand its stablecoin offerings.

The acquisition, announced on May 12, remains subject to regulatory approvals and standard closing conditions. While financial details weren’t disclosed, the deal marks another example of the growing convergence between traditional finance (TradFi) and crypto-native firms.

As part of the acquisition, Anchorage will absorb Mountain Protocol’s team, technology stack, and regulatory framework. Mountain Protocol’s operations are overseen by the Bermuda Monetary Authority, which adds a regulated layer to Anchorage’s expanding global infrastructure.

Anchorage Eyes Stablecoins as Core to Crypto Infrastructure

Anchorage CEO Nathan McCauley emphasized the increasing importance of stablecoins in the digital economy, predicting that “every business” will eventually rely on them. He views the integration as a critical step toward meeting the rising demand for stablecoin use in enterprise and institutional finance.

Source: Anchorage Digital

Martin Carrica, CEO of Mountain Protocol, echoed the sentiment, highlighting that the combination of Anchorage’s infrastructure and Mountain Protocol’s stablecoin expertise puts the two firms in a strong position to lead the next wave of stablecoin adoption globally.

This move comes roughly nine months after Anchorage launched a stablecoin rewards initiative for institutional holders of PayPal’s USD stablecoin, reinforcing its commitment to this growing market segment.

USDM Stablecoin Begins Wind-Down Process

In a key part of the transition, Mountain Protocol announced it will begin winding down its Ethereum-based stablecoin, Mountain USD (USDM), which had once peaked at a $155 million market cap shortly after its 2023 launch.

Minting of USDM ceased on May 12. The stablecoin will continue offering yield rewards for the next 30 days, after which the APY will drop to 0%. Users can redeem USDM via Mountain Protocol’s platform, while other holders are encouraged to exchange the token on supported markets.

Notably, Mountain Protocol’s USDM should not be confused with the similarly named USDM from Mehen Finance on the Cardano blockchain.

According to data from RWA.xyz, USDM’s current market cap has fallen below $50 million, with an estimated 10,820 holders.

Strategic Implications

The acquisition reinforces Anchorage’s ambition to become a central infrastructure provider in the evolving stablecoin landscape. As institutional and enterprise use of stablecoins grows, integrating a regulatory-compliant and yield-bearing asset framework like Mountain Protocol’s positions Anchorage to offer a more robust and diversified stablecoin suite.

Summary:

Anchorage Digital acquires Mountain Protocol to scale its stablecoin capabilities, while Mountain USD (USDM) begins an orderly wind-down after ceasing new minting on May 12.