Mastercard (MA) is considering making a strategic investment in blockchain infrastructure firm Zerohash after acquisition talks collapsed when the crypto company opted to remain independent, according to a person familiar with the matter.
Fortune reported in October that the payment processor was in late stage talks to buy Zerohash, and could pay as much as $2 billion for the firm, which provides custody, settlement and fiat on-/off-ramps so that fintech companies and brokerages can offer digital assets without building the plumbing themselves.
Those talks have ended, according to three people who spoke on condition of anonymity as the matter is private. Nevertheless, investment discussions are in progress, according to two of the people.
Mastercard declined to comment.
“We are not entertaining an acquisition by Mastercard. We respect the Mastercard team and look forward to scaling commercial partnerships,” a Zerohash spokesperson said in emailed comments. “Our team is central to our velocity, and we believe that remaining independent best positions Zerohash to continue innovating, building and delivering for our customers.”
Crypto merger and acquisition activity is on the rise. CoinDesk reported last week that crypto data platform CoinGecko was looking for a buyer for around $500 million.
As dealmaking returns to the industry, the most attractive M&A targets are no longer speculative protocols, but proven infrastructure projects with revenue and regulatory footing. Likely candidates include licensed exchanges and brokerages that offer instant market access, custody and staking providers with institutional clients, and high-margin data and compliance firms.
Mastercard has been linked to a number of other potential takeovertargets in the digital assets sector.
Crypto exchange Coinbase and Mastercard are both said to have considered an acquisition of BVNK, a London-based fintech that builds stablecoin payment infrastructure, according to a Fortune report in October.
Read more: Crypto data platform CoinGecko weighs sale for around $500 million, sources say
