Stripe Inc. today announced plans to buy Bridge Ventures Inc., a startup with a platform for processing stablecoin transactions.
The companies didn’t disclose the deal’s financial terms. However, a source told Forbes that Stripe is paying $1.1 billion for Bridge. That’s more than five times the valuation startup reportedly received following a funding round earlier this year.
Many companies require the ability to process digital payments, but lack the technical resources to build the necessary software. One reason the task is complicated is that payment processing software must comply with a long list of financial regulations and cybersecurity requirements. There are also other challenges, such as the need to add integrations with external banking infrastructure.
Stripe has established itself as one of the tech industry’s most valuable startups by automating those tasks for developers. Instead of creating a payment processing system from scratch, software teams can simply integrate the company’s platform into their applications with a few lines of code. Stripe takes on the regulatory compliance chores and other tasks involved in moving funds.
Bridge has a similar business model, but with a narrower focus on stablecoins. Those are digital assets pegged to a currency or a financial instrument. Using Bridge’s platform, developers can build applications that process stablecoin transactions with a fraction of the work that would usually be required for the task.
Some companies use the startup’s software to accept customer payments in stablecoins. Others rely on Bridge to process cross-border transactions. Additionally, the company provides a service that allows developers to issue their own stablecoins and invest users’ funds in U.S. Treasuries.
Bridge was founded in 2022 by Chief Executive Officer Zach Abrams and Chief Technology Officer Sean Yu. The duo previously launched Evenly, a payment app that was acquired by Block Inc. in 2013. Abrams went on to become the head of Coinbase Inc.’s consumer business, while Yu has held engineering roles at Airbnb Inc., Square Inc. and other tech firms.
Today’s acquisition comes a few months after Stripe added cryptocurrency support to its payment processing platform. The company launched a similar capability in 2018, but had to discontinue it after encountering technical issues.
The stablecoin segment is the latest in a series of markets where Stripe has established a presence to maintain its revenue growth. The company, which reportedly generates more than $2.5 billion in annual revenue, previously launched tools that automate accounting tasks and ease the process of incorporating a business. Stripe also offers data analytics features for processing financial logs from its platform.
Stripe expects to complete the Bridge acquisition in the coming months.