World

Steller Foundation partners with Advent to Acquire MoneyGram: Report

Stellar Foundation, which supports the Stellar Network for blockchain-based payment services,
Steller Foundation partners with Advent to Acquire MoneyGram: Report

Stellar Foundation, which supports the Stellar Network for blockchain-based payment services, is partnering with private equity firm Advent to purchase MoneyGram. Stellar Foundation has reportedly already spoken to the 81-year old remittance company about the possibility of purchasing it, according to unnamed sources. Sources unnamed claim that neither party has reached a decision and either could suspend their acquisition efforts.

The Stellar Development Foundation, a San Francisco-based non-profit blockchain-based organization that facilitates cross-border payments between consumers or institutions, was founded in 2014. Stellar invested $15 million in AirTM in May. This digital wallet and peer-to-peer exchange platform is based in Mexico.

Stellar has partnered with Advent, a Boston-based company that has experience in investing in the payments sector, to discuss the possibility of an acquisition. Advent has previously backed Worldpay and Vantiv in the past.

MoneyGram was the subject of interest from a blockchain-based payment services company in the past. In late 2019, blockchain firm Ripple purchased a $50 million stake in the payment giant. However, after selling some of their stakes, both companies decided to end their agreement in March 2021. After Ripple was sued by the US Securities and Exchange Commission for $1.3 billion, this decision was made.

MoneyGram remains one of the largest remittance agents in the world. The company’s stock rose 279% to $11.59 on Wednesday due to a market cap of $932 million. MGI has seen a jump of over 15% in the past five days and more than 65% in three months. It currently boasts a 110% gain year-to-date.

It is not the first time that news has been reported about a possible MoneyGram acquisition. Ant Group, a Chinese financial service conglomerate, bought MoneyGram in 2017. After some resistance from regulators, the company decided to withdraw its consent. According to inside sources, Western Union Co., a rival money-transfer firm, also tried to buy MoneyGram last year.

MoneyGram is now offering crypto. Customers can now purchase crypto with cash and withdraw from physical US locations through a partnership with Coinme. These companies plan to expand the offering globally in the second half of this year. Other financial service firms, such as Visa, MasterCard, and PayPal, have also moved into crypto.

Bitcoin has risen more than 90% this year, but it is down 15% from $64,000 in April. Ether has increased by more than 170%, while Dogecoin rose 10,000%. Dogecoin is up 4,000% since its inception in 2013. Western Union, a rival company, has yet to make announcements regarding crypto support.

Given its rivalry to Ripple, it might seem odd that Stellar would take over MoneyGram. The two crypto firms have a historic rivalry with Ripple co-founder Jed McCaleb leaving the company in 2013 after clashing with the rest of leadership to start Stellar.

Disclaimer: We may link to sites in which we receive compensation from qualifying purchases. We only promote products and services that we believe in.

Continue Reading

×