Coinbase and stablecoin startup BVNK have reportedly parted ways on a $2 billion acquisition deal that would have been among the largest crypto company deals ever and would’ve significantly expanded Coinbase’s institutional stablecoin offering.
Fortune reported on Tuesday that the decision was mutual, but it isn’t clear why the parties sought to cancel the deal. Coinbase and BVNK, which builds stablecoin infrastructure, had reached the due diligence stage of the deal after signing an exclusivity agreement in October.
“After discussing a potential acquisition of BVNK, both parties mutually agreed to not move forward,” a Coinbase spokesperson told Fortune, adding that it would continue to explore other opportunities.
It would have been Coinbase’s second-largest deal after completing its $2.9 billion purchase of crypto derivatives exchange Deribit in August.
Coinbase’s attempt to buy the stablecoin company comes as Wall Street’s interest in the tokens has skyrocketed, as international payment networks including Western Union, MoneyGram, and SWIFT have started integrating stablecoin solutions.
The $312 billion stablecoin market is riding on regulatory momentum after the US passed the GENIUS Act in July, and the US Treasury estimated in April that the stablecoin market could grow to $2 trillion by 2028.
BVNK Slated to Expand Coinbase Stablecoin Revenue
The BVNK acquisition could have boosted Coinbase’s share of revenue from stablecoin services, which accounted for $246 million, or 19%, of its $1.9 billion in revenue reported by the crypto exchange in the third quarter.
Calling off the acquisition, however, could now free up capital for Coinbase to pursue another move in the stablecoin space.
BVNK to Reassess
Meanwhile, BVNK will head back to the drawing board after also previously being in talks with Mastercard about a potential acquisition in October.
Citi’s venture capital arm, Citi Ventures, and Mastercard rival Visa also invested in BVNK back in May.
The UK-based BVNK was launched in October 2021 by CEO Jesse Hemson-Struthers, chief technology officer Donald Jackson, and chief business officer Chris Harmse, and says it now processes more than $20 billion in annualized volume.