- Anchorage Digital announces plans to acquire Mountain Protocol, issuer of the USDM stablecoin, pending regulatory approval.
- The USDM stablecoin, currently regulated in Bermuda, is being phased out, with technology and staff integrating into Anchorage’s operations.
Anchorage Digital, a U.S.-based digital asset bank, has announced its intention to acquire Mountain Protocol, the creator of the USDM stablecoin. The terms of the deal were not disclosed, and the transaction will require approval from regulators. The move is part of Anchorage’s efforts to expand its role in the stablecoin sector to better serve institutional clients.
According to Anchorage Digital, the acquisition supports its long-term plan to facilitate greater stablecoin adoption among institutions. CEO and Co-Founder Nathan McCauley stated, “Stablecoins are becoming the backbone of the digital economy. With recent regulatory progress and new institutional use cases, our long-term vision is clear: every business will be a stablecoin business.”
Anchorage Digital already collaborates with leading financial organizations, including providing asset custody services to BlackRock and institutional crypto exchange EDX Markets, which was founded by firms such as Citadel Securities, Fidelity, and Schwab. In addition to digital assets like cryptocurrencies, stablecoins are increasingly used as collateral for intraday margin. Recent pilots by the Commodity Futures Trading Commission (CFTC) and the CME Group highlight this evolving use case.
Mountain Protocol, which is based in Bermuda and began operations in mid-2024, is in the process of winding down its interest-bearing USDM stablecoin, which had a market cap below $50 million. Anchorage will integrate Mountain Protocol’s staff and technology into its operations.
This deal follows earlier steps by Anchorage to build its presence in the stablecoin space, such as joining the Paxos-founded Global Dollar Network, a collaborative stablecoin protocol, and running a stablecoin rewards program that allows holders to earn rewards without lending out their digital assets. Most other stablecoins do not provide interest to users, making Anchorage’s move to acquire an interest-bearing protocol notable.
Currently, draft U.S. legislation would prohibit stablecoin issuers from paying interest to users, but would still permit third parties to offer such rewards. Technology from the acquisition could be used in Anchorage’s existing reward programs or to enable client-issued stablecoins.
The stablecoin sector continues to see heightened activity. VISA, an Anchorage backer, recently invested in the stablecoin firm BVNK and partnered with Stripe’s Bridge to let users spend stablecoin balances via Visa cards. Other recent developments include Stripe launching stablecoin accounts for businesses in emerging markets, Coinbase introducing the x402 protocol for online payments, and reports that Meta is considering stablecoins for payouts.
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