Author: David Christopher
Compiled by: Saoirse, Foresight News
This month, three cryptocurrency companies filed for Chapter 11 bankruptcy protection in the United States, and two exchanges announced their impending closure. During this same period of successive industry blow-ups, MoonPay, Circle, and Kraken each announced or finalized deals to accelerate their investment in core business infrastructure.
A common pattern in mature tech industries is the increasing homogenization and commodification of infrastructure, with capital subsequently shifting towards business integration. The crypto industry follows this trend, but with an added variable: the ultimate industry structure remains unsettled. No one can definitively predict which platforms the public will predominantly use for trading, which public chain will settle the most value, or which USD stablecoin will become the market's standard.
This fundamentally alters the underlying purpose of acquisitions in the crypto space. In mature markets, consolidation aims to increase profit margins. In crypto, companies integrate to ensure their survival regardless of which trading channels, underlying blockchains, or dominant stablecoins ultimately win out. The differences in the three companies' acquisition logic essentially stem from their varying degrees of dependence on the outcomes of these three major industry-defining questions.
MoonPay: No Need to Bet on Winners
MoonPay operates at the gateway connecting traditional financial systems and the on-chain economy. Most crypto applications require tools to convert bank balances to on-chain assets and vice versa. MoonPay's business model isn't tied to any single blockchain nor does it rely on one stablecoin dominating the market.
On July 16th, MoonPay acquired Glide, marking its sixth acquisition this year and continuing its established development strategy. Glide enables various applications to receive deposit funds from most tokens, wallets, exchanges, and bank cards, automatically performing token swaps and cross-chain operations to deliver the assets users need. Prior to this, MoonPay had already bolstered its capabilities through multiple acquisitions in areas like private key management, trade execution, AI quantitative trading, and financial reconciliation. While MoonPay previously handled only the initial and final steps of fiat on/off-ramping into the crypto world, it now participates throughout the entire user journey—fund transfer, trade settlement, account reconciliation, and withdrawal—regardless of which platform users trade on.
Polygon serves as a stark contrast. In January this year, Polygon spent over $250 million to acquire Coinme and Sequence, adding compliant licenses, wallets, and fiat on/off-ramp capabilities to its "Open Monetary System." Both companies are building similar business modules, but Polygon's profit maximization depends on significant value settling on the Polygon blockchain; MoonPay's profits, however, follow user movement and are not constrained by any single chain.
Circle: Must Defend USDC's Dominance
Circle's revenue heavily relies on a single asset: USDC. The emergence of OUSD is putting direct profit pressure on Circle.
The Open Standard Alliance includes over 140 companies like Visa, Mastercard, Stripe, BlackRock, and Coinbase. Its rules allow partners to mint and redeem OUSD for free, and cooperating institutions can retain the vast majority of interest generated from the reserve assets after deducting minimal management fees. On the day this news broke, the share price of Circle's parent company, CRCL, fell by approximately 16%. Reserve interest is Circle's most critical revenue stream. Even if USDC's circulation remains stable, if Circle is forced to cede more interest to exchanges and wallet providers to ensure they continue supporting USDC, its profit margins would still come under pressure.
Circle's recently announced patent acquisition is precisely a response to this competition. Circle purchased nearly a thousand granted patents from IBM's blockchain patent portfolio, covering areas such as banking, insurance, enterprise infrastructure, and secure cloud services. Circle stated that these patents will be used to empower USDC, the Circle payment network, the Arc platform, and smart financial instruments, without disclosing further details.
If profit-sharing becomes the norm in the stablecoin industry and interest spreads universally narrow, the core criteria for user choice will shift beyond mere interest yield to the supporting ecosystem: settlement pathways connecting banking and corporate systems, treasury management tools for corporate funds, and complete traceability capabilities meeting audit requirements. Compared to simply competing on interest, competition at the infrastructure level promises more enduring competitiveness.
Kraken: Striving to Become the Comprehensive Mainstream Trading Terminal
Coinbase, Robinhood, and Kraken are in a race to build all-in-one accounts, enabling users to trade a full spectrum of assets within a single account: crypto spot, on-chain assets, stocks, derivatives, payment products, and tokenized securities. Concurrently, the three are building their own on-chain trading ecosystems based on the Base blockchain, Robinhood Chain, and Ink blockchain respectively, aiming to bridge on-chain and off-chain markets for a unified trading experience.
Kraken's parent company, Payward, recently finalized an acquisition agreement to acquire the wallet-as-a-service business of Magic Labs, whose underlying infrastructure powers embedded wallets in applications like Polymarket. Currently, Kraken users can trade on-chain tokens without creating a separate wallet; its tokenized stock product, xStocks, has surpassed $350 billion in cumulative trading volume; Kraken also operates the Ethereum Layer 2 network, Ink, though this chain hasn't yet achieved widespread adoption.
Following the acquisition of Magic Labs, Kraken can deeply embed wallet functionality into its own products. Users won't need to repeatedly switch to third-party wallets for on-chain operations but can access on-chain markets directly within the existing Kraken app. The Ethereum Layer 2 network, Ink, can also leverage this underlying infrastructure to more seamlessly connect with Kraken's vast existing user channels.
Industry developments over the past weeks confirm that the race for exchanges to build on-chain trading ecosystems remains fluid. Robinhood Chain launched on July 1st, and within three weeks, its daily active users surpassed Base's. Early traffic was mainly driven by meme coin trading, and now its tokenized stock trading is also gaining traction. Although Base still holds stronger hard metrics like liquidity and stablecoin supply, Robinhood's rapid rise demonstrates that traditional brokerages can leverage their existing user channels to quickly establish a new on-chain trading stronghold.
The triggers for the bankruptcies and shutdowns of several crypto companies this month vary, but all point to an industry-wide reshuffling. On the other side, major platforms continue acquiring various technical capabilities, simultaneously strengthening their current product competitiveness and hedging their bets across multiple potential future industry outcomes.
As the barriers to acquiring underlying infrastructure continue to lower, the key to winning the industry competition shifts to product integration fluency and ecosystem network scale. Although the crypto industry is maturing, ample competitive space remains across various major sectors.
