Stripe acquires Privy to further improve stablecoin infrastructure layout

Stripe Acquires Privy, Further Improving Stablecoin Infrastructure Stripe, the payment giant, announced on June 12th the acquisition of Privy, a popular embedded wallet infrastructure provider that helps platforms like Hyperliquid, OpenSea, Blackbird, and Toku directly embed crypto wallets into user experiences, eliminating operational complexity and improving conversion rates. Stripe serves half of the Fortune 100 companies and 78% of Forbes AI 50 companies. Last year, Stripe processed $1.4 trillion in payment transactions, growing 38% year-on-year. The platform's revenue growth is seven times faster than S&P 500 companies, giving it massive influence in mainstream business. In other words, Stripe is an ideal choice for driving stablecoin development. For Stripe, which understands fund dynamics, this acquisition follows their $1.1 billion purchase of stablecoin service provider Bridge last October. While the surface-level benefit is Privy's ability to expand Stripe's on-chain wallet account capabilities, the deeper implications might involve negotiations with banks and compliance, but this doesn't diminish Web3 payment's enormous potential. Privy, founded in 2021, aims to help developers easily build superior products on crypto infrastructure. Their goal is to make cryptocurrency user-friendly and accessible, starting with creating better wallets by simplifying complex technical details and providing a seamless user experience. Currently, Privy supports over 75 million accounts across 1,000 development teams, facilitating billions of dollars in transactions and enabling users to conveniently earn, transfer, and use new assets. After the acquisition, Privy will continue to operate independently, allowing for more flexibility and focused service delivery. In their annual letter for 2024, Stripe boldly stated: "The Stripe platform will become the best way to build stablecoin applications." This acquisition demonstrates their rapid execution of this strategic roadmap.

Funds must be stored somewhere, and Privy is building the world's best programmable vault. In addition to our other stablecoin-related work, we look forward to helping birth a new generation of globalized, internet-native financial services.

—— Patrick Collison, Stripe CEO

2.1 Privy and Stripe

Privy is not just a set of APIs, but a battle-tested product with a developer experience similar to Stripe, a customer-centric team, and strong credibility in the crypto builder ecosystem. Industry professionals consistently emphasize its execution quality.

Like other tech giants' self-developed technologies, although some might think Stripe could develop this functionality internally, this overlooks the key point: developing the first version is easy, but perfecting the details—handling edge cases, adapting to customer needs, supporting production workloads—is not.

Of course, this is more than just a technical acquisition. Stripe chose to acquire to gain market response speed, brand credibility, and product-market fit, combined with further integration of Bridge's stablecoin business.

Stripe obtained:

• A top-tier team with native cryptocurrency product genes;
• A developer-centric embedded wallet platform;
• A broad native cryptocurrency customer base;
• Momentum now, rather than 18 months later.

As Dr. Feng Xiao of Hashkey clearly stated: Blockchain is the next-generation financial infrastructure.

This is crucial, but what I want to emphasize is: Blockchain is internet-based, and in the internet battle, speed is critical.

More importantly: The internet has network effects.

In this battle for the next generation of finance, Stripe is accelerating, and Privy can help them achieve this goal faster, while others are still discussing how to issue stablecoins.

2.2 Stripe and Privy

For Privy, Stripe brings massive improvements in business coverage and resources:

• Extensive distribution channels for numerous fintech and enterprise developers;
• A reputation for reliability and compliance globally;
• Capital and support to continue operating independently.

2.3 Bridge: Backend Support for Stablecoins

Stripe's Bridge, acquired in October 2024 for $1.1 billion, provides three core services that developers can access with just a few lines of code:

• Stablecoin Orchestration Function: Enabling enterprises to transfer, store, and accept various stablecoins, with Bridge handling compliance and regulatory requirements.
• Currency Exchange Function: Allowing enterprises to convert local fiat to stablecoins.
• Transfer Function: Supporting global fund flow and account creation for USD and EUR.

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Now, Privy is responsible for wallet infrastructure, Bridge provides stablecoin backend services, and Stripe has already mastered both ends of the stablecoin stack. Historically, stablecoin adoption has been limited by infrastructure gaps - enterprises want to accept cryptocurrency payments but find it difficult for users to get started, while users want to pay with cryptocurrency but face the complexity of wallet operations.

But now, Stripe can eliminate these barriers, ending the dial-up era of crypto integration.

For stablecoin adoption, this could be a potential turning point. Stripe's influence far exceeds crypto-native applications, covering mainstream commerce, enterprise software, and global markets. By making stablecoin API integration as simple as adding a payment method, Stripe has the potential to accelerate cryptocurrency adoption in markets that still remain niche, driving Crypto Mass Adoption.

End of Article

This article is for learning and reference purposes only, hoping it will be helpful to you, and does not constitute any legal or investment advice, not your lawyer, DYOR.

Reference:

[1] Privy and Stripe: Bringing crypto to everyone

https://privy.io/blog/announcing-our-acquisition-by-stripe

[2] Stripe Acquires Privy: Building the On-Chain Banking Stack

https://www.thisweekinfintech.com/the-weekly-stable-vol-21

[3] Stripe's Superstar Stablecoin Stack

https://www.bankless.com/read/stripes-superstar-stablecoin-stack?ref=bankless.ghost.io

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