- Blockchain and infrastructure provider Paxos announced its acquisition of digital asset security and custody firm Fordefi.
- The rumor mill has it that the deal cost over $100 million.
Paxos recently made a big move in the cryptocurrency space. The New York-regulated blockchain infrastructure and tokenization platform announced its acquisition of Fordefi, an institutional-grade security and custody platform for digital assets.
According to Paxos, the venture marks the combination of its decade-long expertise in the Web3 sector with Fordefi’s decentralized finance (DeFi) wallet solutions. The latter is known for its multi-party computation (MPC) wallet infrastructure.
What is MPC?
MPC is a cryptographic method that essentially enables multiple parties to split their private keys into multiple encrypted “shares.” Without the key’s complete form, it eliminates the traditional single point of failure inherent in a standard private-key management system.
To execute a transaction, each party holding a share of the keys must collaborate to generate a valid digital signature. This occurs without the need to reconstruct the full key.
Overall, the process considerably enhances security.
The Fordefi Acquisition of Paxos
Neither Paxos nor Fordefi disclosed the nature of the acquisition and the amount involved. However, rumors have it that the agreement came into the tune of over $100 million.
The move aims to offer institutional clients to build upon a single, trusted platform to issue stablecoins, tokenize assets, and create complex payment flows. All these come amid the parties’ compliance with the highest standards of security and market regulations.
Charles Cascarilla, CEO and co-founder of Paxos, highlighted that Paxos is a neutral, enterprise-grade platform that focuses on bridging enterprises into the digital asset economy. Fordefi aligns with the company’s goal of bringing more entities into the space with its signature easy-to-use Application Programming Interface (API) and Web3 accessibility.
“Together, Paxos and Fordefi provide customers with a world-class custody solution built upon advanced wallet technology and regulated, qualified custody,” said Cascarille. “We’re excited to welcome Fordefi to our team as we enter this new phase of growth.”
Financial industry powerhouses, including PayPal, Mastercard, Nubank, Mercado Libre, and Interactive Brokers, are already using Paxos’ solutions. It’s known for issuing stable assets like the PayPal USD (PYUSD), Pax Gold (PAXG), and Pax Dollar (USDP).
Josh Schwartz, CEO of Fordefi, emphasized that roughly 300 institutions have already adopted their wallet platform. The New York and Tel Aviv-headquartered business’s integration with Paxos will allow both to expand their global reach while enhancing their unified custody and stablecoin infrastructures.
