Coinbase In Late-Stage Talks To Acquire Stablecoin Startup BVNK In $2 Billion Deal

According to a report from Bloomberg, US-based cryptocurrency exchange Coinbase (COIN) is reportedly in advanced negotiations to acquire BVNK, a startup specializing in stablecoin infrastructure, in a deal valued at approximately $2 billion. This acquisition is pending due diligence and could see closure later this year or early next year.

Coinbase Ventures Poised To Acquire BVNK

Coinbase Ventures, the venture capital arm of Coinbase, is known to be an investor in BVNK, suggesting a pre-existing relationship that may facilitate the acquisition. 

One spokesperson told Bloomberg that the company is committed to its mission of expanding economic freedom globally and actively explores various opportunities through building, acquiring, partnering, or investing.

If the deal goes through, it would mark another significant move in the stablecoin sector, especially following the introduction of the first US regulations on these assets in July with the passage of the GENIUS Act. 

This regulatory framework has prompted various entities, including credit card giants Visa and Mastercard, as well as traditional banks, to experiment with blockchain technology to streamline financial transactions.

Earlier this week, Fortune reported that Coinbase has secured exclusivity in discussions with BVNK following a competitive bidding process. 

Coinbase has been actively seeking to diversify its revenue streams beyond trading fees, with nearly 20% of its revenue in the third quarter coming from stablecoins, as indicated in the company’s recent shareholder letter. 

The exchange aims to enhance the utilization of Circle’s USDC stablecoin, for which it shares revenue with issuer Circle Internet Group Inc., and has formed partnerships, such as with Shopify, to further this goal.

Exceeding Expectations

Founded in 2021, BVNK has successfully raised $90 million in funding from notable investors, including Citi Ventures, Haun Ventures, and Visa. 

BVNK’s platform enables merchants to accept payments in stablecoins, which aligns with Coinbase’s strategy to create a more comprehensive banking experience built on stablecoins. 

Earlier this year, Coinbase launched Coinbase Business, a platform designed to assist businesses with payments and invoicing, indicating a clear intent to expand its offerings in this area.

The exchange has also recently completed its acquisition of Deribit, a leading player in the options market that holds over 75% of market share outside the United States, according to Alesia Haas, Coinbase’s finance chief.

In its third-quarter report, Coinbase surpassed analysts’ expectations with a transaction revenue of $1.05 billion, a substantial increase from $572.5 million during the same period last year. 

The exchange’s stock, COIN, closed the week’s trading session at $343, an 8.2% retrace in just four days amid the broader crypto market’s volatility. 

Featured image from Shutterstock, chart from TradingView.com