Two Years Ago vs Today: Crypto Partnerships Become Infrastructure Deals
In 2024, announcements pairing banks, payment companies and established financial institutions with digital asset firms frequently centered on experimentation, access or validation. A traditional institution was testing blockchain. A payments company was adding crypto capabilities. A digital asset company was gaining the credibility or distribution that came with an incumbent partner. Those…
Two years ago, crypto partnerships typically centered around experimentation, access or validation for traditional institutions. A bank would test blockchain technology, a payment company would add crypto capabilities, and a digital asset company would gain credibility through a partnership with a well-established player. However, the tide has turned, as evidenced by Circle's acquisition of Tazapay, an all-stock deal valued at $400 million.
Tazapay brings an extensive payment network and infrastructure that could help make digital dollars more useful in institutional payments. This shift from partner to infrastructure provider and potential acquisition signifies a broader change in the digital assets landscape. Banks, payment networks, and crypto firms are now moving towards solving specific problems in settlement, liquidity, interoperability, tokenization, and cross-border money movement.
The focus has shifted from foundational questions to determining which combination of infrastructure makes the economics work. This evolution is evident in Citi's successful processing of live transactions on Swift's blockchain-based ledger, and Visa's development of its Visa Stablecoin Platform (VSP) to provide infrastructure for minting, moving, redeeming, and managing stablecoins while connecting activities to existing payment and treasury workflows.
Visa has also expanded its stablecoin settlement pilot to nine blockchains, demonstrating the maturation and increasing competition in the space.
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