Axios Pro: Fintech Deals

March 11, 2022

Axios Pro Exclusive Content

Happy Friday, Fintech Deals readers. We made it through another week!

Situational awareness: The NFT market is cooling off, and fast.

  • The average selling price of an NFT has dropped more than 48% since a November peak to around $2,500 over the past two weeks, according to NonFungible.

1 big thing: Stripping down Stripe's crypto push

Illustration: Aïda Amer/Axios

Stripe on Thursday announced that it is now supporting cryptocurrency businesses and has already onboarded well-known names, including FTX, and Nifty Gateway.

Why it matters: For Stripe — known for powering payments in much of the startup ecosystem — the move into crypto plugs a noticeable hole in its customer base.

  • For crypto lovers, the payments darling having their back is yet another signal that crypto is going mainstream.

Context: Stripe has long been bullish on crypto, but has struggled to find a business rationale for the asset class and has historically considered companies in the space risky.

  • In 2018, Stripe ended support for payments made in bitcoin, saying the rising value of the cryptocurrency made it less useful for such transactions.
  • Stripe previously barred many cryptocurrency and mining businesses from its services, saying the sector posed “elevated financial risk.”

That began changing late last year amid a frenzy of crypto deal-making.

  • Stripe signaled it was getting back into crypto by making hires in October and adding Paradigm's Matt Huang to its board in November.

Be smart: This isn't Stripe full-on body-slamming into the crypto industry — at least not yet.

  • The announcement centers on how exchanges, NFT companies and wallet providers can use Stripe’s existing products to buy crypto and NFTs using debit cards and ACH bank transfers; for fraud mitigation; and for handling compliance.
  • "To date, the crypto industry has struggled with poor reliability and low authorization rates when it comes to accepting fiat payments," a Stripe spokesperson wrote in an email.

What we’re watching: Whether Stripe finds a way back into crypto-native payments.

  • Crypto proponents say using the asset directly for payments is faster, cheaper, and has the potential to disrupt Stripe itself. But the technology has yet to replace existing rails.
  • On Thursday, the Stripe page introducing its web3 push included a line about "easy-to-use integrations for stablecoin payouts."
  • Industry watchers took that as a potential sign of a return to crypto payments using stablecoins.
  • That reference disappeared on Friday, and Stripe declined to comment.

Zooming out: Yes, multiple payments players can coexist here, with companies often using several providers. But there's maybe just a touch of 🌶️spice🌶️ here, too.

  • Competitor moved earlier and faster into the crypto-infrastructure space, with such clients as MoonPay, Coinbase and, yes, FTX.

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