Original | Odaily Planet Daily (@OdailyChina)
Author | Fu He How (@vincent 31515173)
Stripe is a household name in the global payment field. Recently, the company announced the acquisition of Web3 payment platform Bridge for $1.1 billion, becoming the largest acquisition in the history of Web3 and attracting widespread attention. This is not only an important step for Stripe to expand its payment solutions, but also a landmark moment for Web3 technology to emerge in the traditional financial system.
Odaily Planet Daily will delve into the two parties involved in this acquisition and the motivations behind it.
Basic Introduction of Stripe and Bridge
Founded in 2010 and headquartered in San Francisco, Stripe is a fintech company focused on online payment solutions. Founded by brothers Patrick Collison and John Collison, Stripe is known for its easy-to-use APIs and powerful developer tools, quickly becoming the preferred payment processing platform for millions of merchants worldwide.
Main Products and Services:
Payment Processing: Stripe offers various payment methods, including credit cards, debit cards, and digital wallets, helping merchants easily accept online payments.
Subscription Management: Stripe's subscription management tools enable SaaS companies and other businesses to easily handle recurring payments.
Fraud Detection: Stripe Radar uses machine learning technology to monitor transactions in real-time to identify and prevent fraudulent activities.
Global Support: By supporting multiple currencies and local payment methods, Stripe helps merchants expand into international markets.
Developer-Friendly: Stripe offers detailed documentation and robust APIs, significantly lowering the technical barrier.
Stripe has not only gained the trust of many startups and large enterprises (such as Amazon and Uber) but also reached a valuation of $95 billion in 2021, becoming one of Silicon Valley's most valuable startups.
Bridge is a stablecoin-based payment platform that challenges traditional payment systems like SWIFT and credit cards by innovating global capital flow. Bridge's core value lies in its ability to allow developers to seamlessly convert between fiat and stablecoins and flow across different blockchains.
Main Features and Services:
Stablecoin API: Bridge focuses on providing developers with stablecoin-related APIs, allowing them to easily implement seamless conversions between fiat and stablecoins.
Cross-Border Payments: Bridge provides cross-border payment and currency exchange services, allowing users to quickly transfer funds using its Orchestration APIs.
Capital Reserves: Bridge invests its reserve funds in U.S. Treasury bonds, yielding an annual return of over 5%, ensuring the safety and stability of its funds.
Compliance: Bridge has obtained licenses in 48 states and holds a VASP license from Poland, ensuring its compliance operations.
Fast and Efficient: The entire funds transfer process typically takes only a few minutes, with fees amounting to just a few cents, making it a strong competitor to traditional payment systems.
It is worth noting that on August 30 of this year, Bridge announced it had secured $58 million in funding from Sequoia Capital, Ribbit Capital, Index Ventures, Haun Ventures, 1confirmation, and BEDROCK. Just two months later, Stripe announced it had invested $1.1 billion to acquire Bridge.
Moreover, according to official news, since its launch 18 months ago, Bridge has processed over $5 billion in annual payment volume and has collaborated with several fintech companies, including well-known firms such as Coinbase, Bitso, and SpaceX.
Strong Alliance: Analyzing the Reasons for Stripe's Acquisition of Bridge
Stablecoin payments, especially cross-border payments, are gradually developing in various countries and regions. The author previously interviewed one of the companies selected for Hong Kong's stablecoin sandbox, Circle, where CEO Rita emphasized the role and future development of the Hong Kong dollar stablecoin, particularly in cross-border payments. For details, please see the article (Interview with Circle CEO Rita: How will the Hong Kong dollar stablecoin shine in Web3?).
Stablecoin payment solutions are one of the trends of the future, and as a payment giant, Stripe's specific reasons for acquiring Bridge are as follows:
Expanding Market Share: The primary reason for Stripe's acquisition of Bridge is to further expand its market share, especially in the Web3 and stablecoin sectors. With the development of blockchain technology, an increasing number of merchants and consumers are beginning to accept digital currencies. By acquiring Bridge, Stripe can quickly enter this emerging market and provide more comprehensive payment solutions.
Technology Integration and Innovation: Bridge's technological foundation and innovative capabilities align well with Stripe's core business. By integrating Bridge's stablecoin API and cross-border payment capabilities, Stripe can enhance its existing payment products, improving the speed and efficiency of transactions. This technological integration not only enhances user experience but also opens up more possibilities for future product innovation.
Competitive Advantage: In the fintech industry, competition is becoming increasingly fierce. Stripe faces pressure from companies like PayPal and Square, while also contending with emerging competitors in the Web3 space. The acquisition of Bridge will give Stripe a competitive advantage in both technology and market aspects, particularly in providing blockchain-based payment solutions.
Attracting Developers and Enterprises: Bridge is known for its developer-friendly API, which aligns closely with Stripe's strategic goals. By acquiring Bridge, Stripe can further attract developers and enterprises by providing richer tools and resources to help them build and scale their businesses in the Web3 environment.
Strengthening Compliance Capabilities: Compliance in stablecoin payments is crucial in the fintech industry. Bridge has obtained compliance licenses in multiple regions, providing the necessary compliance foundation for Stripe's global expansion. The acquisition of Bridge will enable Stripe to better address regulatory requirements in different countries and regions, reducing compliance risks.
This acquisition is not only a collaboration between Stripe and Bridge but also a milestone for the entire Web3 industry. With traditional fintech giants placing importance on Web3 technology, more funds and resources will flow into this field, driving its development. In the future, Web3 may further integrate with traditional payment systems, creating more innovative payment solutions.