Blockchain infrastructure company Paxos has acquired Fordefi, a New York-based institutional crypto wallet and custody technology startup. This strategic acquisition aims to integrate Fordefi's multi-party computation (MPC) wallet technology and decentralized finance (DeFi) integrations with Paxos's regulated custody infrastructure. The combined offering is designed to provide institutions with a unified platform for issuing stablecoins, tokenizing assets, and managing on-chain transactions.
While the specific terms of the transaction were not disclosed, a Paxos spokesperson indicated to Fortune that the deal was valued at over $100 million. Fordefi, founded in 2021, developed one of the first institutional MPC wallets specifically designed for DeFi. Its technology includes governance features that empower companies to authorize and sign on-chain transactions.
Fordefi will continue to operate independently for the time being, with Paxos intending to gradually integrate its technology into its broader infrastructure offerings.
Paxos's Role in the Blockchain Ecosystem
Paxos is a regulated blockchain infrastructure company that offers custody, tokenization, and stablecoin services to prominent enterprises, including PayPal, Mastercard, and Interactive Brokers. The company holds licenses in the United States, Europe, and Singapore. Paxos issues several stablecoins, such as PayPal USD (PYUSD), Pax Dollar (USDP), Pax Gold (PAXG), and Global Dollar (USDG).
The Growing Integration of DeFi Across Exchanges
The broader cryptocurrency industry is witnessing an increasing trend of companies embedding DeFi protocols directly into their products. This allows users to gain direct access to on-chain lending, tokenized assets, and yield-generating tools.
In June, Kraken enhanced its on-chain capabilities through a partnership with Solana-based DeFi Development Corp. This collaboration leveraged DeFi Development Corp's xStocks platform to bring Kraken shares on-chain. This initiative built upon a previous partnership in May that enabled Kraken to offer tokenized US equities to clients in select non-US markets.
By September, Coinbase had integrated the Morpho lending protocol into its application. This integration allows users to lend USDC directly within the app, eliminating the need to navigate separate DeFi platforms or external wallets. Coinbase stated that users could earn up to 10.8% on their USDC holdings through this feature.
In October, Crypto.com followed suit by adding Morpho to its native Cronos blockchain. This move enables users to earn stablecoin yields on wrapped Bitcoin (BTC) and Ether (ETH).
According to data from DefiLlama, DeFi protocols currently hold approximately $116 billion in total value locked (TVL). Prior to the largest liquidation event in crypto history on October 9, the TVL was around $170 billion.
