It doesn’t look like digital payments firm Stripe is having any second thoughts about its bitcoin breakup.
A year after sending the flagship cryptocurrency a Dear John letter, the Silicon Valley fintech darling has reportedly achieved a staggering $22.5 billion valuation following a $100 million investment from Tiger Global Management. That’s a nearly 13 percent increase from the firm’s previous $20 billion valuation, which Stripe received following a Tiger Global-led $245 million funding round in 2018.
“Stripe is rapidly scaling internationally, as well as extending our platform into issuing, global fraud prevention, and physical stores with Stripe Terminal,” a Stripe spokesperson said in an emailed statement quoted by CNBC. “The follow-on funding gives us more leverage in these strategic areas.”
One area that no longer remains a part of Stripe’s strategic plan is bitcoin payments.
The startup, which in 2014 became the first major payment processor to add support for bitcoin, removed that functionality last year, blaming slow transaction confirmation times and high fees for a substantial decrease in the number of merchants accepting crypto payments.
Former Stripe product manager Tom Karlo had kind words for bitcoin, which was still trading near its all-time high when Stripe announced the breakup last January:
Over the past year or two, as block size limits have been reached, Bitcoin has evolved to become better-suited to being an asset than being a means of exchange. Given the overall success that the Bitcoin community has achieved, it’s hard to quibble with the decisions that have been made along the way. (And we’re certainly happy to see any novel, ambitious project do so well.)
A few months later, though, Stripe COO Claire Hughes Johnson made a comment that suggested the breakup was less than amicable.
“The killer app for Bitcoin out there today is ransomware,” she said at the Fortune Brainstorm Tech conference in July 2018 (video above). “I do think we’ve reached that jump the shark moment where you just say ‘da-da-da blockchain.’”
Moreover, the ink had yet to even dry on Stripe’s Dear Bitcoin letter when the firm began to openly flirt with Stellar, to whom it had already provided seed funding, as well as other lower-fee cryptocurrency networks. “We may add support for Stellar (to which we provided seed funding) if substantive use continues to grow,” Karlo said, though this has not yet come to fruition.
In any case, Stripe’s decision to shun crypto payments — at least for now — doesn’t seem to have hurt its bottom line.
Stripe already ranked as the world’s most valuable fintech unicorn, according to data from CB Insights, but this enhanced valuation pushes the firm even further into the lead.
Notably, its closest US competitor is cryptocurrency exchange Coinbase, which achieved an $8 billion valuation following a 2018 funding round that was also led by Tiger Global. Coinbase ranks third globally, trailing $10 billion India-based startup One97 Communications, best known as the operator of Paytm.
John Collison Image from RISE/Flickr