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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

UK-Based IG Group Acquires Independent Reserve

Eric Risley
September 26th, 2025
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Transaction Overview

On September 19th, 2025, IG Group, a UK-based trading platform specializing in leveraged trading, acquired a 70% stake in Independent Reserve, an Australian cryptocurrency exchange for A$109.6 million ($72.5 million) in upfront consideration and A$15 million ($9.9 million) in contingent consideration. 

 

Target: Independent Reserve

Independent Reserve is a Sydney-based cryptocurrency exchange founded in 2013 that serves retail, self-managed super funds, and institutional clients in Australia and Singapore.

 

Key offerings include spot trading in 30+ digital assets, multi-currency funding and trading (AUD, SGD, NZD, USD), an OTC desk for large orders, and APIs and workflows tailored to institutions. The firm also touts its ability to be the sole custodian of client’s crypto assets, utilizes cold storage, maintaining  asset segregation and and no rehypothecate. 

 

Independent Reserve’s revenue for the 12 months ended June 30, 2025 was A$35.3 million ($23.2 million), which is up 88% year over year. Furthermore, Independent Reserve custodies A$1.7 billion ($1.1 billion) in assets and has 129,400 funded accounts and 11,600 monthly active customers.

 

Competitors are Caleb & Brown, Swyftx, BTC Markets and Coinspot, all based in Australia,  Coinhako Privé and QCP Trading for regional institutional flow and Coinhako, Crypto.com, and Coinbase in Singapore.

 

Independent Reserves sold a 25% stake in the business to Mike Tilley and KTM Ventures / Capital in 2018.

 

Buyer: IG Group

IG Group is a London-headquartered FTSE 250 online trading and investments company founded in 1974. Through the IG and tastytrade brands it allows its clients to trade via spread betting, contracts for difference, options, forex, and share dealing across roughly 19,000 markets. It broadened its direct-to-consumer reach with the ~$1B tastytrade acquisition in 2021 and a January 2025 agreement to acquire Freetrade for an enterprise value of £160 million ($196 million) funded from existing cash.

 

Clients trade and invest on IG’s own web and mobile platforms, which bundle real-time data, research tools, structured education, and daily tastylive programming to keep users learning and engaged. This content-led approach supports client retention and helps investors progress from basic to advanced strategies. The company operates under local regulation in 16 countries, enabling consistent service with jurisdiction-specific protections and product availability.

 

In 2025 it launched crypto trading in the UK in partnership with Uphold, while in the U.S. tastytrade provides crypto access and custody infrastructure through Zero Hash, including 24/7 stablecoin account funding. The Freetrade transaction completed on 1 April 2025, the UK crypto launch went live in June 2025, and tastytrade’s stablecoin funding capability rolled out in July 2025.

 

For FY25, the year ended 31 May 2025, IG reported total revenue of £1,075.9 million ($1,448.2 million), up 9% year over year, and adjusted profit before tax of £535.8 million ($721.2 million). 

 

Transaction Parameters

IG Group will be acquiring 70% of Independent Reserve, paying A$109.6 million ($72.5 million) upfront, with A$15 million ($9.9 million) being contingent upon performance on June 30th, 2026, for a total of A$124.6 million ($82.5 million). 

 

Finally, IG group has the option to acquire the remaining 30% stake in the future, with valuation being determined by 2027 and 2028 financial performance. The firm, however, has put a maximum cap on the value of the 30% stake of A$160.5 million ($106.2 million). Meaning at most, IG Group would have to pay A$285.1 million ($188.7 million). However, as it stands today, the multiple on the consideration paid upfront, A$109.6 million ($72.5 million) is 3.1x. Finally, the transaction is expected to be cash-EPS accretive in the first full year post-close and to exceed WACC on a three-to-five-year view.

 

Notable similar transactions include Figure Markets | Figure Technology (M&A Alert) Caleb & Brown | Swyftx for $100 – $200M (M&A Alert), WonderFi | Robinhood for $179M (M&A Alert) Coinbase | Deribit for $2.9B (M&A Alert),  Hidden Road | Ripple (M&A Alert), NinjaTrader | Kraken for $1.5B (M&A Alert), FairX | Coinbase (M&A Alert), and Robinhood | Bitstamp for $200M (M&A Alert).  

 

Strategic Rationale

The deal closes a product gap in a priority region by giving it immediate, licensed exchange and OTC presence in Australia and Singapore, with optionality to expand across Asia Pacific and the Middle East; it keeps Independent Reserve’s leadership and brand, and plans to integrate its product into IG’s trading platforms starting in Australia and Singapore. 

 

Architect Partners’ Observations

While headlines are great, the details matter more. In this case, IG Group is acquiring only 70% of Independent Reserve, and a portion of the closing consideration is being held back and is contingent upon performance in the fiscal year ending June 30, 2026. IG Group has the option to acquire the remaining 30% stake in the future, with the purchase price dependent on financial performance in fiscal years 2027 and 2028.

 

The bottom line: the actual consideration at closing is $72.5 million for control of a business that generated $23.2 million in revenue over the past twelve months, a modest 3.1x revenue multiple. Yes, the structure allows for future payments, the amount of which will depend on future performance. This may result in a higher valuation multiple in retrospect.

 

Why this structure? Almost certainly to bridge a gap between the valuation expectations of the acquirer and the seller. In M&A, there are many ways to create structures that can be win-win if certain future events unfold. In this case, IG Group can acquire the remaining 30% ownership stake at pre-negotiated values that vary with financial performance over the next three years. The shareholders of Independent Reserve are effectively putting that future consideration at risk because they believe they can perform well and “earn” an even better outcome. The nuances here are only partially disclosed, so it’s impossible for an outsider to assess the specifics. However, these types of structures, and the required leap of faith, can be an effective mechanism to align buyer and seller needs.

 

Sources 

PitchBook, IG Group Press Release, Architect Partners Insights.