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Payward Acquires Magic Labs Embedded Wallet Business
Payward Acquires Magic Labs Embedded Wallet Business

Transaction Overview
On July 27, 2026, Payward, the B2B crypto infrastructure parent behind the crypto exchange Kraken, announced a definitive agreement to acquire wallet-as-a-service business Magic Labs. Financial terms of the transaction were not disclosed.

Target: Magic Labs (Wallet Infrastructure)
Founded in 2018 and headquartered in San Francisco, Magic Labs is a wallet-as-a-service infrastructure provider that enables businesses to create non-custodial embedded wallets for their end users. The company was co-founded by Sean Li, Arthur Jen, and Jaemin Jin.

Magic’s core offering is a developer-facing SDK and API that provides embedded wallets with passwordless authentication via email, social login, passkeys, or SSO. The product suite includes 1) API Wallets for server-side management with security and customizable key sharding, and 2) Embedded Wallets for client-side non-custodial key management. As of July 2026, the platform supports more than 30 blockchain networks and provides a white-label UI, fiat onramps, and transaction signing.

As of July 2026, Magic Labs had provisioned more than 60 million wallets and served more than 200,000 developers across more than 18,000 applications. Clients include Polymarket, Naver, Helium, Forbes, WalletConnect, Mattel, and Immutable. During the 2024 U.S. presidential election, Polymarket processed over $3 billion in prediction market transactions with zero downtime, powered by Magic’s embedded wallets. Magic said it had supported over $8.9 billion in cumulative transaction volume for Polymarket as of November 2025.

Magic Labs has raised a total of $83 million in disclosed venture funding across 4 rounds, with significant investors including PayPal Ventures, Northzone, Tiger Global, Digital Currency Group, CoinFund, and Placeholder VC.

In November 2024, Magic Labs announced Newton, a chain unification network built in collaboration with Polygon Labs, expanding beyond wallet infrastructure into cross-chain protocol development. In November 2025, Magic Labs integrated the Newton Protocol SDK across its developer network. The company described Newton Protocol as “the authorization layer for on-chain finance.” These moves preceded the company’s decision to divest its wallet business and refocus entirely on protocol development.

Buyer: Payward
Founded in 2011 and headquartered in San Francisco, Payward is a private B2B crypto infrastructure holding company. Payward operates Kraken, one of the longest-running cryptocurrency exchanges, alongside NinjaTrader, xStocks, Bitnomial, and CF Benchmarks. The company is led by co-CEOs Arjun Sethi and Dave Ripley.

Most relevant to this transaction, Payward operates Payward Services, a B2B infrastructure platform that provides institutions with access to Payward’s trading, custody, settlement, and payments infrastructure via API. The acquisition of Magic Labs adds embedded wallet infrastructure to their offering. In April 2026, Payward launched a white-label fiat-to-crypto onramp through a partnership with Onramper, making embedded wallet infrastructure a natural adjacent capability.

Payward has been expanding beyond its core exchange through acquisition. In 2025, the company acquired NinjaTrader for $1.5 billion (retail futures, M&A Alert) and agreed to acquire Backed Finance (tokenized equities, Press). In 2026, it acquired Magna (token lifecycle management, Press), completed the acquisition of Bitnomial for up to $550 million (regulated derivatives, M&A Alert), and agreed to acquire Reap for $600 million (card issuance and payments, M&A Alert). Including this transaction, Payward has announced or completed 8 acquisitions since early 2025, committing several billion dollars to platform expansion ahead of its planned public listing.

For the full year of 2025, Payward reported adjusted revenue of $2.2 billion, a 33% increase year over year from $1.5 billion in 2024. Trading-based revenue accounted for 47% of the total, with the remaining 53% from asset-based services, including payments, custody, yield, and financing.

In November 2025, Payward raised $800 million at a $20 billion post-money valuation in a round backed by Citadel Securities, Jane Street, and Apollo Global Management, and confidentially filed an S-1 with the SEC ahead of a planned IPO. In April 2026, Deutsche Börse Group made an additional $200 million strategic investment in the company.

Transaction Parameters
Payward has signed a definitive agreement to acquire the wallet-as-a-service business of Magic Labs for an undisclosed amount. The transaction includes Magic Labs’ embedded wallet business, including wallet clients and associated infrastructure.

The transaction is part of a broader corporate restructuring in which Magic Labs is rebranding as Newton Labs to focus on the Newton Protocol. The two companies will remain independent following the close.

Architect Partners served as the exclusive financial advisor to Magic Labs.

Strategic Rationale
Payward is acquiring Magic’s embedded wallet business to augment Payward Services’ B2B offering. Payward Services gives partners a single integration point for trading, custody, tokenized assets, on/off-ramps, and derivatives. The wallet, the account layer where end users actually hold assets and interact with onchain products, was a critical piece partners still had to source from a third party. Magic brings that layer in-house with proven infrastructure: a TEE-based signing solution, an embedded integration layer, and a developer SDK that together have provisioned more than 60 million wallets and supported over $10 billion in stablecoin volume for 200,000+ developers.

On Day 1, Payward can offer fintechs, enterprises, and financial institutions a complete embedded onchain offering under a single provider, spanning wallet provisioning, onboarding, funding, trading, custody, and settlement, without stitching together multiple vendors. Every embedded wallet also becomes a distribution point that routes transaction volume into the rest of Payward’s infrastructure, deepening the non-trading, less volatile revenue that already accounts for 53% of Payward’s total as it heads toward a public listing.

Architect Partners’ Observations
This transaction marks the near-completion of a consolidation wave in embedded wallet infrastructure. In roughly one year, Fireblocks acquired Dynamics ($90M), Consensys acquired Web3Auth ($50M), Stripe acquired Privvy, Ripple acquired Palisade, and Paxos acquired Fordefi. Now each group has its own independent wallet infrastructure provider, and Payward has acquired the category’s pioneer. The market has reached a clear verdict: embedded wallets are foundational infrastructure for every onchain product, and they are a layer of a full-stack platform rather than a standalone business.

The logic is simple: the wallet is becoming the account primitive of onchain finance. Whoever provisions the wallet sits at the front of the customer relationship and routes the volume that follows. For platforms whose trading revenue is inherently cyclical, owning the onboarding layer converts market position into durable, recurring B2B infrastructure revenue.

Sources
Press Release, Payward Services, PitchBook

Alerts

Figure to Acquire Kiavi for $717M

Eric F. Risley
June 11th, 2026
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Transaction Overview
On June 10th, Figure Technology Solutions (Nasdaq: FIGR) announced a definitive agreement to acquire Kiavi, an AI-powered lending platform for residential real estate investors, in a transaction valued at $717 million. Under the structure, Figure acquires Kiavi’s technology and operating platform, while a joint venture between Figure and global investment firm Sixth Street acquires the loan assets held on Kiavi’s balance sheet.

 

Target: Kiavi
Founded in 2013 as LendingHome by Matt Humphrey and James Herbert and rebranded to Kiavi in November 2021, Kiavi is a Pittsburgh-based, AI-powered lending platform serving residential real estate investors. It ranks as the number one Residential Transition Loan lender in the United States and is one of the nation’s largest non-bank lenders to real estate investors.

 

Kiavi’s products span short-term Residential Transition Loans (RTL), used for fix-and-flip and bridge financing, and longer-duration Debt Service Coverage Ratio (DSCR) loans for rental properties, alongside new construction and jumbo offerings. The platform pairs proprietary AI decisioning, including a post-renovation home value engine and automated document review, with a deep origination data set to underwrite and fund investor loans at speed and scale.

 

The company has funded more than $30 billion across over 100,000 loans since inception and lends in 49 states plus Washington, D.C. In its most recent year, Kiavi reported more than $250 million in revenue and more than $100 million in EBITDA, a high-margin profile that is uncommon among specialty lenders. Chief Executive Officer Arvind Mohan will join Figure’s executive team as Chief Business Officer following the close.

 

According to Pitchbook, Kiavi has raised $557 million of disclosed venture equity across multiple rounds. Its latest disclosed valuation round was its $75 million Series E in December 2020 at a $405 million post valuation. Other sources of funding include several hundred million dollars in warehouse facilities and securitization funding. Backers include Foundation Capital, Ribbit Capital, Renren (now Moatable), First Round Capital, and Benefit Street Partners.

 

Competitors include other non-bank lenders to residential real estate investors such as Lima One Capital, RCN Capital, Anchor Loans, Roc Capital, LYNK Capital, and Groundfloor, alongside regional banks and private credit funds that finance fix-and-flip and rental investors.

 

Buyer: Figure
Figure Technology Solutions (Nasdaq: FIGR) is a blockchain-native capital marketplace for the origination, funding, sale, and trading of tokenized assets. Founded in 2018 by Mike Cagney and June Ou and built on Provenance Blockchain, Figure is the largest non-bank provider of home equity financing, with more than $25 billion originated to date and over 380 partners using its loan origination system and capital marketplace. Figure estimates it accounts for roughly 75% of all real-world asset tokenization activity.

Figure’s ecosystem centers on Figure Connect, its consumer credit marketplace, and Democratized Prime, an on-chain warehouse marketplace that matches lenders with investors seeking institutional-grade returns. Supporting infrastructure includes DART, its digital asset registry for custody and lien perfection; $YLDS, an SEC-registered yield-bearing stablecoin; and Adaptor, a newly launched AI product that enables agent-to-agent onboarding of disparate originator data across asset classes. Figure has secured AAA ratings from S&P and Moody’s on multiple blockchain-based loan securitizations, a first for the asset class.

Figure completed its IPO in September 2025 at $25 per share, raising roughly $788 million in its offering at an initial valuation near $5.3 billion. Today Figure trades around $6.3 billion with an LTM revenue of $516M and an adjusted EBITDA of $303M. Worth noting, the Kiavi transaction, announced roughly nine months after the listing, is Figure’s first major acquisition as a public company and a deliberate push into first-lien origination and agentic AI.

 

Transaction Parameters
The transaction carries a headline total purchase price of $717 million across two related legs: Figure’s acquisition of Kiavi’s technology and operating platform, and the acquisition of Kiavi’s balance-sheet loan assets by a Figure / Sixth Street joint venture. Reported financing details indicate approximately $538 million of contribution from Figure and approximately $179 million from Sixth Street, suggesting that the majority of the difference between Figure’s base platform purchase price and the headline transaction value relates to the JV / balance-sheet asset component, though the final bridge may also reflect customary adjustments and other closing mechanics.

 

Based on Kiavi’s reported revenue of more than $250 million and EBITDA of more than $100 million, Figure’s reported $538 million contribution implies approximately 2.2x revenue and 5.4x EBITDA for the platform component, while the $717 million headline transaction value implies approximately 2.9x revenue and 7.2x EBITDA on a blended basis. The latter includes the balance-sheet asset purchase by the Figure / Sixth Street joint venture and is therefore not a clean operating-business multiple.

 

Figure expects the deal to be accretive to earnings per share, to deliver an unlevered cash payback in under four years, and to support its 60% medium-term EBITDA margin target, adding more than $7 billion in annual first-lien volume to Figure Connect and over $100 million monthly to Democratized Prime.

 

Comparable fintech and lending platform transactions, though larger and imperfect given this deal’s blockchain dimension, include: Rocket | Mr. Cooper ($9.4B equity value), Rocket | Redfin ($1.75B), SoFi | Galileo ($1.2B), and SoFi | Technisys ($1.1B).

 

Strategic Rationale
The acquisition routes a profitable, scaled origination engine onto blockchain rails. Figure’s core thesis is that capital markets are migrating on-chain, and Kiavi supplies high-quality, recurring first-lien origination volume that feeds directly into Figure Connect and Democratized Prime. Management expects the platform to add more than $7 billion in annual volume immediately, against what the companies frame as a $200 billion annual addressable origination opportunity in residential investor lending.

 

The deal diversifies Figure beyond its home equity base into first-lien credit. Figure’s franchise was built on HELOCs and other second-lien products; Kiavi’s RTL and DSCR loans are first-lien, a market the company describes as roughly 25 times larger than second-lien. Figure’s first-lien volume grew about 2.5 times year over year in 2025, and with Kiavi, management projects first-lien will exceed 40% of consumer loan marketplace volume for full-year 2027, materially reducing concentration in any single product.

 

The transaction also advances Figure’s agentic AI roadmap while preserving its capital-light model. Kiavi’s AI decisioning, including its post-renovation valuation and document review engines, complements Figure’s blockchain data layer, and Kiavi’s asset class will serve as the first use case for Adaptor, Figure’s agent-to-agent onboarding product. By placing the balance sheet loans into the Sixth Street joint venture rather than onto its own books, Figure captures the origination flow and platform economics without absorbing the funding burden.

 

Architect Partners’ Observations
The partnership structure is central to the strategic logic of the transaction. By acquiring Kiavi’s technology and operating platform while placing the balance sheet loans into a Figure and Sixth Street joint venture, Figure captures the full origination funnel while preserving its high-margin, capital-light profile. Sixth Street supplies the balance sheet capacity and private credit expertise, allowing Figure to expand into a scaled first-lien lending vertical without absorbing the full funding burden of the loan book. This is indicative of the growing convergence of traditional finance and blockchain infrastructure.

 

What makes Figure particularly particularly exciting is that it’s leading the effort to unify blockchain and TradFi. Rather than waiting for legacy lenders to adopt blockchain rails, Figure is acquiring traditional asset origination and bringing that volume onto its own platform. In doing so, the company is positioning itself not just as a technology provider, but as a scaled marketplace for tokenized credit. Bringing residential investor credit on-chain is a concrete proof point that whole lending categories, not just home equity, can migrate toward blockchain-based settlement and distribution. Every additional asset class Figure can tokenize increases the relevance of its marketplace and infrastructure, while expanding the opportunity set for institutional capital to access credit through on-chain rails.

 

Sources
PitchBook, Press Release, Figure, Kiavi, Sixth Street