Stripe acquisition of Bridge: The layout of giants in the stablecoin era

Stablecoins are sweeping the global financial market, with a year-on-year growth rate exceeding 50%. The global transaction settlement volume is already more than twice that of Visa. Against this backdrop, the American payment giant Stripe has acquired the stablecoin API service provider Bridge for $1.1 billion, attracting widespread attention in the industry. This article will delve into the rise of stablecoins, Bridge's business model, and the logic behind Stripe's acquisition.

1. The Rise of Stablecoins

A recent cryptocurrency report pointed out that stablecoins have become one of the most significant "killer applications" in the Web3 space. Thanks to the widespread adoption of smartphones and the implementation of blockchain technology, stablecoins are driving an unprecedented financial empowerment movement.

Stablecoins greatly simplify the process of value transfer. Currently, their quarterly trading volume is more than twice that of a major payment company, with an annual asset settlement value reaching trillions of dollars, fully demonstrating their practicality. In terms of daily active addresses, stablecoins account for nearly one-third of daily cryptocurrency usage, second only to decentralized finance (DeFi).

According to a report from a certain payment giant, the total supply of stablecoins is approximately $170 billion, settling assets worth trillions of dollars each year. There are about 20 million addresses conducting stablecoin transactions on-chain each month, with over 120 million addresses holding a non-zero stablecoin balance. This data indicates that stablecoins are forming a parallel monetary system to the traditional financial system.

It is worth noting that the application of stablecoins in non-cryptocurrency fields is also becoming increasingly widespread, including remittances, cross-border payments, salary disbursement, trade settlement, and merchant payments. Many major financial companies and international organizations are actively exploring the potential of stablecoin payments.

2. The Business Model of Bridge

Bridge, founded by Sean Yu and Zach Abrams, is a company that provides stablecoin API services. Its core products include the Orchestration API, which helps Web2 companies integrate stablecoin payments, and the Issuance API, which supports users in issuing their own stablecoins.

The services of Bridge cover stablecoin cross-chain transactions, fiat/cryptocurrency deposit and withdrawal acceptance, as well as virtual bank account functions, aiming to provide Web2 users with a more convenient stablecoin usage experience. The company has attracted numerous clients, including a well-known aerospace company, with an annual payment processing volume exceeding $5 billion.

In terms of financing, Bridge has previously raised $58 million from several well-known investment institutions, with the most recent round valuing at $200 million. The $1.1 billion acquisition price represents a 5.5 times premium, setting the largest acquisition deal record in the cryptocurrency industry to date.

Three, Strategic Cooperation between Stripe and Bridge

Stripe's acquisition of Bridge is an important step in the trend of the rise of stablecoins. The integration of both parties will further promote Stripe's cryptocurrency payment strategy, enabling it to handle stablecoin transactions more efficiently and enhance the transparency and security of transactions.

Bridge stated in an official announcement that the two companies will jointly accelerate the adoption and utility of tokenized dollars, allowing global users to transfer, store, and consume currency more conveniently. They believe that stablecoins are becoming the core infrastructure for global capital flows, representing a brand new payment platform.

IV. Stripe's Cryptocurrency Strategy

Stripe has been active in the cryptocurrency sector recently. In October of this year, the company reopened its cryptocurrency payment gateway for U.S. merchants, allowing them to accept stablecoin payments through multiple mainstream blockchains. Additionally, Stripe has established partnerships with several cryptocurrency companies, including incorporating a certain Layer 2 solution into its cryptocurrency payment products.

Stripe's cryptocurrency business mainly focuses on two directions: the conversion channel between fiat currency and cryptocurrency (On/Off Ramp) and cross-chain settlement of cryptocurrency and stablecoin. The acquisition of Bridge will help Stripe quickly improve these functions, better serve existing customers, and expand new market opportunities.

5. The Stablecoin Strategy of Payment Giants

Apart from Stripe, other payment giants are also actively laying out plans in the stablecoin field. A large payment platform issued its own stablecoin on Ethereum last year and has expanded it to the Solana network this year. The company is actively promoting the development of its stablecoin developer ecosystem and has proposed a three-phase evolution approach for stablecoin payments towards large-scale adoption.

Another payment giant focuses on the Bitcoin sector, holding a large amount of Bitcoin assets and making multiple investments in the cryptocurrency space.

6. Conclusion

As the stablecoin market continues to expand, there may be more large-scale acquisition transactions in the future. Payment giants are accelerating their布局 to prepare for the upcoming stablecoin era. In this rapidly developing field, companies with advanced technology and extensive partnerships will hold a competitive advantage.