After making strides toward its stablecoin launch, Stripe will acquire crypto wallet provider Privy.
Although Privy is not yet a leading player in the crypto wallet space, it has 75 million accounts and partnerships with brands like trading platform Hyperliquid and NFT marketplace OpenSea.
Privy’s protocols allow clients to build crypto wallets embedded directly into their platforms. The Stripe acquisition—details of which have yet to be disclosed—should vastly expand Privy’s ecosystem.
Though the brand will come under Stripe’s umbrella, Privy will continue to operate as an independent product. In a social media post, Privy said that both companies share the goal of bringing crypto and fiat closer together to transform how value moves digitally.
Crypto Stops and Starts
The deal represents Stripe’s continued investment in the digital assets space following its blockbuster acquisition of stablecoin issuer Bridge. Shortly after the $1.1 billion deal, Stripe announced it was going ahead with trials of its dollar-backed stablecoin overseas.
The long-awaited launch follows a series of crypto-related stops and starts for the fintech. Stripe made an early foray into bitcoin payments years ago, but the demands of processing crypto proved too intensive. Additionally, the company has been working toward launching a stablecoin for over a decade.
Beaten to the Stablecoin Punch
Momentum has been building for Stripe in recent years, after the fintech partnered with Coinbase to allow users to receive payouts and convert fiat into stablecoins like Circle’s USDC and Pax Dollar.
The launch of its own stablecoin will place Stripe in a highly dynamic $250 billion market. Payments competitor PayPal has already taken an early lead with the launch of its PYUSD coin two years ago.
While PYUSD has yet to capture significant market share of companies like Tether and Circle yet, PayPal is betting that its well-established customer base and strong relationships with institutional investors will help its offering gain ground.
Stripe is likely aiming to leverage its customer base in a similar way. It stands apart from other crypto platforms through enterprise-grade, compliant products. The addition of an embedded crypto wallet should further solidify Stripe’s position in the digital assets space.
