Bridge Wants to Take Stablecoins to the Next Level

Drawing on their extensive experience in fintech, Bridge aspires to build a future global payment network around stablecoins in order to challenge everything from Swift to credit cards.

A startup called Bridge, cofounded by ex-Square and Coinbase employees Zach Abrams and Sean Yu, has grand ambitions for the future of stablecoins. They want to build a global payments network around stablecoins that could challenge everything from Swift to credit cards.

And unlike other crypto-native firms developing within the stablecoin ecosystem, Bridge has the backing of some of the top generalist venture firms in Silicon Valley, including Sequoia, Ribbit, and Index, along with the blockchain-focused Haun Ventures. The company has raised $58 million in previously unannounced funding, including a fresh round of $40 million led by Sequoia and Ribbit, and customers including Elon Musk’s SpaceX and Coinbase.

“Fintech is deeply rational,” said Abrams in an interview with Fortune. “If you can do something that is faster, cheaper, and more economical, you win. And that's why I think stablecoins are going to eat the world.”

A stablecoin explosion, but are they really ‘stable’?

While stablecoins have seen massive growth over the past two years—industry leader Tether has a market cap of around $118 billion, while USDC sits at $34 billion—the asset class has also had to contend with several incidents that called into question whether they are truly ‘stable.’

In 2022, the collapse of TerraUSD—a so-called algorithmic stablecoin that maintained its $1 peg through a related cryptocurrency, as opposed to a fiat reserve—triggered a broader meltdown in crypto, leading to regulatory investigations and congressional hearings. Then in 2023, USDC briefly lost its peg on secondary markets upon disclosing that its issuer Circle had parked billions of its reserves with the collapsing Silicon Valley Bank (USDC quickly recovered on news the FDIC would backstop the bank’s deposits). And Tether, still the market dominator, has long faced accusations of opaque accounting.

Despite the challenges, and continued lack of federal legislation that would provide regulation for the nascent sector, stablecoins have managed to roar back, though there are still open questions of how much volume comes from real users, as opposed to bots and large-scale traders. TradFi companies like PayPal and VanEck have launched or backed their own stablecoins, while others such as Stripe have begun to integrate products like USDC into their offerings.

Still, the challenge for many companies who want to use stablecoins is building on-ramps and off-ramps to move fiat currency into and out of the crypto ecosystem, while also facilitating transfers across different types of stablecoins and blockchains. Dollar-backed options like USDC and Tether may be the most popular, but there are countless others with pegs to the Mexican peso or a basket of assets—and a single stablecoin might be issued across a dozen different blockchains.

In an interview with Fortune, Haun Ventures partner Chris Ahn—who first invested in Bridge’s seed round while working at Index—said there would be no need for Bridge if there were just one stablecoin on a single blockchain. Bridge’s value add, he said, is allowing developers to seamlessly move between fiat and stablecoins, and across different blockchains.

“The Stripe of crypto’

The pitch is simple. “We built Bridge as a low-level set of APIs that would enable companies to use a stablecoin rail without thinking about it,” as Abrams put it. But why would companies want that?

As crypto advocates like to point out, moving around fiat currency is slow and expensive—you often need to wait for bank operating hours for large transactions, and cross-border payments can come with massive fees and interminable waits. Stablecoins, at least in theory, offer low fees and instant settlement.

In Bridge’s ideal future, stablecoins will operate as the global payments rail, and Bridge will allow developers to seamlessly integrate. In that sense, you can think of it as a Web3 analog to Stripe, which helps businesses accept online payments, or Plaid, which makes it easy to connect an app to a bank account.

Investors told Fortune that Bridge stands out from other crypto-native firms because of the fintech experience of its founders, who worked at startups including Brex and Square. They believe this will help Bridge serve not only crypto firms, but also companies that operate primarily in fiat.

Bridge 已經擁有包括 SpaceX 在內的知名客戶，該公司使用 Bridge 在不同司法管轄區以不同貨幣收取付款，並透過穩定幣將其轉移到其全球金庫。 Bridge 也與區塊鏈 Stellar 和比特幣應用 Strike 等加密公司合作，為他們自己的穩定幣支付功能提供基礎設施。

Abrams 的前雇主 Coinbase 的一個客戶使用 Bridge 幫助用戶在 Tron 上的 Tether 和 Base（其自己的第 2 層區塊鏈）上的 USDC 之間進行傳輸。 「他們正在做的幫助傳統企業上鍊的工作非常重要，」Base 和 Abrams 的前創辦人 Jesse Pollak

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