Stellar has acquired Chain, the San Francisco-based startup building blockchain technology for the financial industry, according to people familiar with the deal. According to some published reports, the sale price is to be $500 million.
Chain- a strong target for Stellar
Founded in 2014, Chain provides infrastructure to financial institutions wanting to use the blockchain technology in their products and services. Chain’s blockchain based products are created in a manner that facilitates financial entities to digitally transfer money and other assets directly, securely and near instantaneously without much hassle.
Chain also specializes in building cryptographic ledgers that underpin breakthrough financial products and services. In 2015 Nasdaq has previously announced that they will use Chain’s technology to construct a distributed ledger-powered system together with the financial services behemoth Citigroup.
Chain has been looked as a brilliant startup company and had previously raised more than $43 million in funding from the likes of RRE Ventures and Khosla Ventures, to develop blockchain technologies for the financial sector, and to package blockchain technology in accessible ways for financial institutions and banks.
This acquisition news comes at a time as Stellar is currently rated as the seventh most valuable cryptocurrency, with a market capitalization of more than $4.3 billion amidst the cryptocurrency sharp fall in prices. Details of the actual acquisition were sparsely available, however, it is believed to have officially taken place on the 24th of June. Promoters and Investors behind Chain will receive payment in the form of Stellar Lumens (XLM), Stellar’s Native Token Currency, which they should be able to hold or sell immediately after the transaction
It is also unknown whether Chain will continue with its existing line of products, such as the platform ”Sequence” – a ”ledger-as-a-service that enables organizations to securely track and transfer balances in a token format”. Similarly, it is not known whether Chain’s CEO Adam Ludwin will remain at Stellar or not.
The partnership seems to be an excellent fit for Stellar as it looks to benefit from synergies as Stellar continues its mission to integrate blockchain technology into pre-existing financial systems. This also would give Stellar access to some of the fantastic products and technologies that it could use in its existing projects with some of the leading companies such as IBM and Kik, which recently indicated that they both were exploring a new currency based on the Stellar ecosystem
Last week Stellar Lumens also received approval for trading from New York’s financial regulators to trade on ItBit, the second-largest cryptocurrency exchange.
Will Stellar be able to create its dominant position in the financial industry? Do let us know your views on the same