Mastercard (MA) is considering a strategic investment in blockchain infrastructure company Zerohash after acquisition talks broke down after the cryptocurrency company opted to go independent, according to people familiar with the matter.
Fortune reported in October that the payment processor was in the final stages of negotiations to acquire Zerohash, potentially paying up to $2 billion for the company, which provides custody, payments, and fiat on/off ramps for fintechs and brokerages to offer digital assets without having to build the plumbing themselves.
Those negotiations have ended, said the three people, who asked not to be identified because the matter is private. Still, investment talks are ongoing, two people familiar with the matter said.
Mastercard declined to comment.
“We are not thrilled about the acquisition by Mastercard. We respect the Mastercard team and look forward to expanding our commercial partnership,” a ZeroHash spokesperson said in an emailed comment. “Our team is at the heart of our speed, and we believe that by remaining supremely independent, Zerohash can continue to innovate, build, and deliver for our customers.”
Cryptocurrency merger and acquisition activity is on the rise. CoinDesk reported last week that crypto data platform CoinGecko is looking for a buyer for around $500 million.
As deals return to the industry, the most attractive M&A targets are no longer speculative protocols, but proven infrastructure projects with revenue and regulatory foundations. Potential candidates include licensed exchanges and brokerages offering instant market access, institutional custody and staking providers, and high-margin data and compliance companies.
Mastercard has been linked to a number of other potential acquisition targets in the digital asset sector.
Cryptocurrency exchanges Coinbase and Mastercard are both said to be considering acquiring BVNK, a London-based fintech company building a stablecoin payments infrastructure, according to Fortune magazine in October.
read more: Crypto data platform CoinGecko will be sold for about $500 million, sources say
