Coinbase and BVNK End $2 Billion Acquisition Talks

Coinbase, a major player in the cryptocurrency market, and BVNK, a startup focused on stablecoin infrastructure, have jointly decided to abandon a significant $2 billion acquisition deal. This partnership would have enhanced Coinbase's offerings in institutional stablecoins but has now been called off for unclear reasons.

Key Takeaways

Coinbase and BVNK have mutually agreed to end acquisition discussions regarding a $2 billion deal.
The acquisition was intended to strengthen Coinbase's stablecoin services, which generate a noteworthy $246 million in revenue.
The stablecoin market is experiencing growth, supported by regulatory changes and increasing interest from Wall Street.
BVNK will now consider other partnerships after previous discussions with Mastercard.

Coinbase and BVNK End $2 Billion Acquisition Talks

Main Content

Coinbase and the stablecoin startup BVNK have decided to part ways regarding a $2 billion acquisition that could have been one of the largest transactions in the cryptocurrency industry. This deal would have greatly enhanced Coinbase’s institutional stablecoin offerings.

According to a report by Fortune, this decision was mutual, though the reasons behind it remain unclear. Coinbase and BVNK had progressed to due diligence after signing an exclusivity agreement in October. A spokesperson for Coinbase stated, “After discussing a potential acquisition of BVNK, both parties mutually agreed to not move forward,” and emphasized that Coinbase will continue exploring other opportunities.

Had the acquisition proceeded, it would have marked Coinbase’s second-largest deal, following its $2.9 billion acquisition of the crypto derivatives exchange Deribit in August.

The interest in stablecoins has surged on Wall Street, as major international payment networks—like Western Union, MoneyGram, and SWIFT—begin to incorporate stablecoin solutions into their operations.

Source: Cointelegraph

The stablecoin market, valued at $312 billion, is gaining momentum due to recent regulatory advances, including the passage of the GENIUS Act in July. The U.S. Treasury also projected in April that this market could expand to $2 trillion by 2028.

BVNK's Potential Impact on Coinbase's Revenue

Acquiring BVNK could have significantly increased Coinbase's revenue from stablecoin services, which constituted $246 million, or 19%, of Coinbase’s total reported revenue of $1.9 billion in the third quarter. However, walking away from this deal may allow Coinbase to redirect capital towards other ventures in the stablecoin sector.

BVNK's Next Steps

On the other hand, BVNK will reassess its strategy after having also been in discussions with Mastercard about a potential acquisition in October. The startup, based in the UK, received investments from Citi Ventures and Visa back in May. Founded in October 2021 by CEO Jesse Hemson-Struthers, CTO Donald Jackson, and CBO Chris Harmse, BVNK states that it currently processes more than $20 billion in annualized transaction volume.

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