The Rise of Stablecoins: The Logic Behind Stripe's Acquisition of Bridge

Recently, payment giant Stripe acquired the stablecoin API company Bridge.xyz, which was founded only two years ago, for $1.1 billion. This move has attracted widespread attention in the industry. This article will delve into the current development status of stablecoins, Bridge's business model, and Stripe's acquisition strategy.

Stablecoin: The "Killer App" in the Web3 Space

Recent industry reports indicate that stablecoins have become one of the most significant "killer applications" in the Web3 space. Thanks to the proliferation of smartphones and the development of blockchain technology, stablecoins are driving an unprecedented financial inclusion movement.

Data shows that the trading scale of stablecoins has far exceeded that of traditional payment giants. The quarterly transaction volume is more than twice that of a well-known credit card company, and the annual settlement asset value reaches trillions of dollars. In addition, stablecoins account for nearly one-third of daily cryptocurrency usage, second only to decentralized finance (DeFi).

Some surprising stablecoin statistics include:

• Stablecoins have become the sixth largest buyer of U.S. Treasury bonds.
• 30% of cross-border remittances are conducted through stablecoin.
• Major payment companies are advancing stablecoin projects.
• International payment systems and some sovereign countries are exploring the application of stablecoin payments.

The application of stablecoins in non-cryptocurrency fields is also becoming increasingly widespread, including remittances, cross-border payments, payroll distribution, and trade settlement.

Bridge: A bridge connecting traditional finance and the crypto world

Bridge is a stablecoin API engine that provides software tools for businesses to accept stablecoin payments. Its core products include:

1. Orchestration API: Helps Web2 companies integrate stablecoin payments into their existing business, addressing complex issues such as compliance, regulation, and technology.

2. Issuance API: Assists users in issuing their own stablecoin and provides US Treasury investment options to enhance capital utilization.

The services of Bridge also include stablecoin cross-chain trading, fiat/cryptocurrency deposit and withdrawal acceptance, as well as virtual bank account functions, aimed at providing Web2 users with a more convenient stablecoin usage experience.

According to reports, Bridge has attracted numerous clients, including a well-known aerospace company. The company has also established partnerships with several blockchain networks and cryptocurrency payment applications. The annual payment amount processed by Bridge has exceeded $5 billion.

The Collaboration between Stripe and Bridge: Accelerating the Application of Stablecoins

Stripe's acquisition of Bridge reflects the increasing importance of stablecoins in the payment sector. This collaboration will further advance Stripe's crypto payment strategy, enabling it to handle stablecoin transactions more conveniently.

The Bridge official stated that both parties will work together to promote the application and practicality of tokenized dollars, allowing global users to more easily transfer, store, and spend currency.

In recent years, global financial institutions and policymakers have gradually shifted their attitudes towards stablecoins, beginning to recognize the strategic importance of this technology for the current financial system. The adoption and use of stablecoins are accelerating, involving multiple areas such as cross-border payments, government aid distribution, and virtual accounts.

Stripe's Cryptocurrency Layout

Stripe has been active in the crypto space recently:

1. Reconnect the cryptocurrency payment gateway for American merchants, supporting stablecoin payments across multiple blockchain networks.

2. EU companies allow users to purchase mainstream cryptocurrencies.

3. Collaborate with a cryptocurrency exchange to integrate Layer 2 solutions and fiat to cryptocurrency entry.

These services primarily focus on the deposit and withdrawal of cryptocurrencies and cross-chain settlement. The acquisition of Bridge will help Stripe rapidly enhance related functionalities, better serve existing customers, and expand into new markets.

The Stablecoin Layout of Payment Giants

Apart from Stripe, other payment giants are also actively laying out their plans in the stablecoin field:

• A well-known payment company has issued its own stablecoin on multiple blockchain networks and is actively promoting the development of the developer ecosystem.

• Another payment company focuses on Bitcoin-related business and has a diversified layout in the cryptocurrency field.

Conclusion

Stablecoins are becoming an important link between traditional finance and the crypto world. With the entry of major payment giants, we have reason to believe that the application scenarios of stablecoins will further expand, driving innovation and transformation in the entire payment industry. In the future, we may see more notable acquisition deals that will further reshape the fintech landscape.