Stripe Acquires Stablecoin Platform Bridge in $1.1 Billion Deal

Payments giant Stripe has successfully acquired stablecoin platform Bridge in a deal valued at $1.1 billion. Michael Arrington, co-founder of TechCrunch, confirmed the acquisition on October 20 through a post on X, although the companies have yet to release an official statement regarding the transaction.

Just a week prior, reports indicated that Stripe and Bridge were in the final stages of negotiations, but no confirmation had been made by either company at that time.

Bridge, founded in 2022 by former Coinbase executives Zach Abrams and Sean Yu, specializes in the creation, transfer, and storage of stablecoins. This acquisition follows a significant $40 million funding round in August, led by investment firms Sequoia, Ribbit, and Index.

For Stripe, the acquisition is a strategic move to enhance its services in the cryptocurrency space. The company initially ventured into Bitcoin payments in 2014 but discontinued the offering four years later due to underutilization. Fast forward to 2024, and Stripe’s president, John Collison, has announced a renewed focus on cryptocurrency, particularly stablecoin payments, citing increased demand for blockchain-based solutions that offer faster transaction speeds and lower costs.

Stablecoins, which are digital currencies pegged to stable assets like the U.S. dollar, aim to minimize the volatility seen in traditional cryptocurrencies such as Bitcoin. Their stability makes them ideal for everyday transactions.

On October 15, Stripe began accepting Circle’s USDC stablecoin in partnership with Paxos, enabling merchants in 70 countries to process fiat-settled stablecoin payments through its "Pay with Crypto" option. This is part of Stripe's broader engagement with the cryptocurrency sector, which has included initiatives like facilitating payouts for creators on X via USDC and launching a fiat-to-crypto onramp service in 2022.

The acquisition of Bridge aligns with a broader trend of rising demand for stablecoins, which reached an all-time high market capitalization of nearly $170 billion in Q3 2024. Ripple CEO Brad Garlinghouse has projected that this market could expand to $3 trillion by 2030.

The competitive landscape for stablecoins is heating up, with traditional financial platforms also entering space. In early October, Visa launched a platform allowing banks to issue fiat-backed stablecoins, recognizing that stablecoin transaction volumes are approaching those of traditional payment networks. Additionally, PayPal made its own foray into the stablecoin market last year with the launch of PayPal USD (PYUSD) on Ethereum, which has since expanded to Solana and now boasts a market capitalization of over $627 million, according to CoinGecko data.

As Stripe strengthens its foothold in the crypto market through this acquisition, it underscores the growing integration of stablecoins into mainstream financial services.