After making progress toward launching its own stablecoin, Stripe is acquiring Privy, a crypto wallet provider.
Although Privy isn’t currently a top player in the crypto wallet sector, it boasts 75 million accounts and partnerships with platforms like trading site Hyperliquid and NFT marketplace OpenSea.
Privy’s technology enables customers to build embedded crypto wallets directly into their applications. The Stripe acquisition, which has yet to provide detailed terms, will significantly expand Privy’s reach within the ecosystem.
Despite this, Privy will continue to operate independently. According to a social media post from Privy, both companies share a goal of bringing cryptocurrency and fiat closer together to transform digital value transfer.
Crypto Progress and Pauses
This deal marks Stripe’s ongoing investment in the digital assets space following its significant acquisition of stablecoin issuer Bridge. Shortly after completing the $1.1 billion deal, Stripe announced plans to launch trials for its dollar-backed stablecoin overseas.
The long-awaited launch comes after years of crypto-related efforts by Stripe. The company previously attempted to process bitcoin payments but found it too challenging due to processing demands. Additionally, over a decade ago, Stripe began working on launching its own stablecoin.
Stablecoin Race
Momentum has built for Stripe in recent years following its partnership with Coinbase, which allowed users to receive payouts and convert fiat into stablecoins such as USDC and Pax Dollar.
The launch of its own stablecoin places Stripe in a highly competitive $250 billion market. Competitors like PayPal have already taken an early lead with the two-year-old PYUSD stablecoin, which has yet to capture significant market share despite having a well-established customer base and strong relationships with institutional investors.
Stripe is likely positioning its own offering to leverage these strengths, aiming for similar success through enterprise-grade, compliant products. The addition of an embedded crypto wallet could further solidify Stripe’s position in the digital assets space.