The past week saw significant speculation regarding a potential acquisition by Stellar, the company behind Stellar Lumens (XLM), of the San Francisco-based cryptocurrency firm Chain. We can now report that a recent Crunchbase update confirms that Chain has indeed been purchased by Stellar.
Details of the actual acquisition are sparse, however, it is to have officially taken place on the 24th of June. Furthermore, reports leading up to the purchase indicated that the payment was to be made in Lumens, Stellar’s cryptocurrency.
Although the specifics of the deal are not known, it was widely reported that Stellar would acquire Chain for $500 million worth of Lumens (XLM). This comes as Stellar is currently rated as the seventh most valuable cryptocurrency, with a market capitalization of more than $4.3 billion.
Chain, on the other hand, has previously raised more than $43 million in funding to develop blockchain technologies for the financial sector, and to package blockchain technology in accessible ways for financial institutions and banks.
Chain also specializes in building cryptographic ledgers, and Nasdaq has previously announced that they will use Chain’s technology to construct a distributed ledger-powered system together with the financial services behemoth Citigroup.
As of yet, it is still unclear how Stellar plans to incorporate Chain into its existing offerings and ecosystem. Some have suggested that this acquisition might merely constitute a part of the ongoing battle for talented cryptocurrency developers between cryptocurrency companies, indicating that Stellar wanted to poach Chain’s talent before anyone else could.
It is also unknown whether Chain will continue with its existing line of products, such as the platform ”Sequence” – a ”ledger-as-a-service that enables organizations to securely track and transfer balances in a token format”. Similarly, it is not known whether Chain’s CEO Adam Ludwin will remain at Stellar or not.
Nonetheless, it would seem that Chain and Stellar could certainly benefit from synergies, as Stellar continues its mission to integrate blockchain technology into pre-existing financial systems.
Moreover, this comes merely a week after Stellar Lumens received approval for trading from New York’s financial regulators to trade on ItBit, the second-largest cryptocurrency exchange.
In addition to this, IBM also recently indicated that they were exploring a new currency based on the Stellar ecosystem, which would be used to send payments between nations in the South Pacific region.
Stellar’s blockchain technology is also being used in order to construct the cryptocurrency for the messaging startup Kik. It would, therefore, seem as if there are certainly ample opportunities for Chains’ products to be used by Stellar, as it continues to work with financial systems and solutions.
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Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the blockchain industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.