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- Mastercard is in advanced talks to acquire crypto firm Zerohash for up to $2 billion.
- The deal could mark Mastercard’s largest commitment to stablecoin infrastructure.
- The move follows rising competition among major payment firms targeting blockchain innovation.
According to the announcement, Mastercard is close to striking a major deal in the crypto space. The payments giant is reportedly in late-stage negotiations to acquire Zerohash, a Chicago-based startup that builds infrastructure for stablecoins and blockchain-based payments.
Sources close to the negotiations revealed that the deal would place a $1.5 to $2 billion valuation on Zerohash. The proposed deal has not yet been concluded but would be one of the biggest acquisitions made by Mastercard in the field of digital assets so far.
This proposed acquisition illustrates the vision of Mastercard to integrate the technology of Blockchain in its worldwide network in the future. The company has crypto payment cards and related settlements in place, and it wishes to further involve itself in the stable coin market.
Stablecoins Drive New Wave of Fintech Acquisitions
Stablecoins are one of the most rapidly expanding areas in the crypto market today.
With the market on the mend and adoption on the rise, payment companies see stablecoins as the key to facilitating faster and less expensive transactions.
Stripe broke the mold earlier in the year with the acquisition of stablecoin infrastructure company Bridge for $1.1 billion.
This set off a chain of rivalry between fintech companies across the globe.
Another company that joined the race was Coinbase, which entered exclusive acquisition talks with BVNK, yet another stable coin provider, for $2 billion. Mastercard was earlier interested in acquiring BVNK, but with the latter being acquired by Coinbase, it shifted its sights on Zerohash, who has more technological capabilities.
Zerohash provides more than simple stable coin transactions to clients. The company has APIs that can help businesses implement crypto-trading platforms and even serve to tokenize financial assets for clients. The nature of the startup makes it very useful to large players in the financial industry who seek to offer new payment models to clients.
Mastercard Eyes Zerohash to Boost Blockchain Presence
If Mastercard goes through with the acquisition of Zerohash, it would make it stronger in the rapidly changing world of blockchain payment technology. Stablecoins might pose a threat to the fee structure that comes with conducting any kind of payment, but it is clear that Mastercard is ready to adopt the technology to stay ahead in the game.
The initial investors in Zerohash are Apollo, Interactive Brokers, Point72 Ventures, and Nyca Partners. The company raised funds last in September with a valuation of $1billion with $104 million. The investors in Zerohash would benefit greatly from the acquisition, and it would give Mastercard access to crypto technology resources.
Previous forays by Mastercard in the blockchain industry, in acquisitions such as that of CipherTrace, were indicative of the challenges and opportunities inherent in the industry. At Zerohash, however, it appears to be targeting growth in the stablecoins market, which is believed to be the future of payment technology.
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