The Daily: Stripe acquires stablecoin platform Bridge for $1.1 billion, crypto markets 'scream risk-on' and more

I hope you had a good weekend, folks. In today's Daily, Stripe's $1.1 billion acquisition of stablecoin platform Bridge is confirmed, Bernstein says Bitcoin ETF inflows, crypto equity markets and retail trading sentiment are "screaming risk-on," Japan's DPP leader pledges a 20% tax cap on crypto gains and more.

Meanwhile, perpetually rising bitcoin prices would lead to societal impoverishment, ECB economists claim, as the BIS highlights risks in TradFi's move toward tokenization.

Let's get started.

Stripe acquires stablecoin platform Bridge for $1.1 billion

Payments giant Stripe has acquired stablecoin platform Bridge for $1.1 billion, according to TechCrunch founder and well-known venture capitalist Michael Arrington, expanding its integration with the space.

• The deal marks Stripe's largest acquisition and is also a record for the crypto industry despite Bridge's relatively under-the-radar status.
• It follows last week's reports that the firms were in advanced acquisition talks, with Bridge later confirming it was joining forces with Stripe in a Monday post on X.
• Notably, Bridge appears to own the @stablecoin handle on the social media platform.
• Bridge, founded by entrepreneurs Sean Yu and Zach Abrams, provides software tools that help companies accept payments in stablecoins.
• The founders previously sold a Venmo competitor called Evenly to Jack Dorsey's Block in 2013, and Abrams is also a former Coinbase executive.
• Bridge had previously raised $58 million from investors, including a $40 million Series A round that valued it at $200 million, making this deal a significant jump in its price tag.
• An early pioneer of bitcoin payment support in 2014, Stripe recently reinstated crypto payments for U.S. businesses via USDC on Ethereum, Solana and Polygon.
• In June, Stripe also inked a partnership with Coinbase to incorporate the crypto exchange's Layer 2 network Base into its crypto payout products and enable users to use Stripe's fiat-to-crypto onramp to buy digital assets with credit cards or Apple Pay inside the non-custodial Coinbase Wallet.

Crypto markets are 'screaming risk-on'

Bitcoin ETF inflows, crypto equity markets and retail trading sentiment are "screaming" a risk-on environment, according to analysts at research and brokerage firm Bernstein.

• Bitcoin, alongside other risk assets, is interpreting rising odds for the overtly pro-crypto Donald Trump to win the U.S. presidential election as bullish, analysts led by Gautam Chhugani wrote.
• Coupled with clearer crypto policy statements from rival Kamala Harris, the market is seemingly less worried about downside risk and finding it attractive to bid, Chhugani added.
• U.S. spot Bitcoin ETFs saw $2.1 billion in inflows last week, the largest since March, while crypto-related equities continue to outperform in October and retail sentiment is boosted by the latest surge in AI bot-connected memecoin activity, the analysts said.

Japan's DPP leader pledges 20% tax cap on crypto gains

Yuichiro Tamaki, the leader of Japan's Democratic Party for the People (DPP), has proposed a plan to reduce tax rates on crypto gains from 55% to 20% ahead of the upcoming general election.

• The DPP's policy pitch also includes tax exemptions for cryptocurrency-to-cryptocurrency exchanges, raising leverage limits for retail investors from 2x to 10x and introducing crypto ETFs.
• While the DPP is a smaller opposition party, surveys suggest it could increase its parliamentary seats following the election, potentially gaining more influence over crypto tax policy reform.
• The proposal stands in stark contrast to Italy's recently announced plans to increase capital gains tax on bitcoin and other cryptocurrencies from 26% to 42%.

Data breach at fiat-to-crypto payment gateway Transak affects over 57,000 users

Transak, a Miami-based fiat-to-crypto payment gateway, has disclosed a data breach affecting 1.14% of its 5 million users, potentially impacting more than 57,000 people.

• Transak is used by major blockchain platforms, including MetaMask, Trust Wallet, Coinbase and Ledger.
• The Stormous ransomware gang claimed responsibility for the breach, stealing 300GB of sensitive data, including IDs and addresses, from a third-party KYC vendor.
• Transak said that no financial data or assets were compromised but advised affected users to look out for suspicious activity and offered identity monitoring services.
• The same group also claimed responsibility for an exploit of the decentralized identity system Fractal ID in July, raising concerns about recurring vulnerabilities in web3-connected identity solutions.

MetaMask and digital identity firm Space ID aim to simplify crypto

MetaMask and Space ID have collaborated on an integration designed to simplify crypto transactions, allowing users to replace complex wallet addresses with customizable handles.

• Users can register a Space ID domain name and map it to their EVM-compatible public addresses to create a single and secure handle when making transactions via MetaMask.
• "This means that, rather than a 42-character muddle of letters and numbers, where one slip means a total loss of funds, Space ID users need only enter a simple username to send crypto," the firms said.

In the next 24 hours

• Bank of England Governor Andrew Bailey will speak at 9:25 a.m. ET on Tuesday. U.S. FOMC member Patrick Harker follows at 10 a.m. ECB President Christine Lagarde is due to speak at 10 a.m. and 3:15 p.m.
• Blockchain Life gets underway in Dubai as Cosmoverse 2024 continues and the AIM Summit concludes.

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