According to Fortune, Coinbase has called off its planned $2 billion acquisition of U.K.-based stablecoin startup BVNK after the companies entered exclusive negotiations back in October. The deal had progressed to the due diligence stage before both parties mutually agreed to terminate talks. This would have been one of the largest stablecoin startup acquisitions ever, nearly doubling the $1.1 billion Stripe paid for Bridge in February. A Coinbase spokesperson confirmed the collapsed deal while BVNK declined to comment. The reasons behind calling off the acquisition remain unclear despite the advanced stage of negotiations.
Stablecoin M&A frenzy continues
Here’s the thing – this collapse comes during what’s basically a feeding frenzy for stablecoin companies. Mastercard was previously interested in BVNK too, and they’re now reportedly in talks to acquire Zerohash for up to $2 billion. Smaller players are getting in on the action as well – Modern Treasury scooped up Beam for around $40 million back in October.
And it’s not just traditional fintech companies driving this trend. Crypto-native projects are building their own stablecoin infrastructure too. Aave Labs has been exploring stablecoin plays, and the Monad Foundation recently acquired Portal specifically to accelerate its stablecoin strategy. Everyone wants a piece of this market, from legacy payment networks to DeFi protocols.
Why everyone wants stablecoins
So what’s the big deal about stablecoins anyway? They’re cryptocurrencies pegged to real-world assets like the US dollar, designed to maintain stability rather than the wild price swings we see with Bitcoin and Ethereum. Proponents argue they can revolutionize cross-border payments, slash transaction fees, and modernize financial infrastructure that’s basically been unchanged for decades.
Think about it – sending money internationally currently takes days and costs a fortune. Stablecoins could make that near-instant and practically free. That’s why everyone from Coinbase to Mastercard is willing to pay billions to get in early. The potential payoff is enormous if they can capture even a fraction of the global payments market.
Coinbase’s acquisition strategy
This failed deal represents a significant shift for Coinbase, which has been on something of an acquisition spree. They dropped $2.9 billion on derivatives exchange Deribit earlier this year, and CEO Brian Armstrong made it clear during their Q3 earnings call that “all of this M&A is really in service of our core focus around trading and payments.”
But now they’re walking away from what would have been their biggest push into stablecoin infrastructure. The timing is interesting – regulatory uncertainty around stablecoins remains high, and maybe Coinbase decided the $2 billion price tag wasn’t worth the risk. Or perhaps they found something during due diligence that gave them pause. We may never know the real reason, but it’s definitely a setback for their payments ambitions.
What happens now?
For BVNK, the collapse means they’re back on the market after being in exclusive talks with Coinbase for months. That’s valuable time lost when you consider how hot the stablecoin M&A market has become. But given that Mastercard was previously interested and other suitors are clearly in the market, they’ll probably find another buyer soon.
For Coinbase, this leaves a gap in their stablecoin strategy right when competitors are doubling down. They’ll need to either find another acquisition target or build their own infrastructure from scratch. Either way, the race to dominate stablecoin payments is far from over – it’s just gotten more complicated.
