Paxos has acquired institutional crypto wallet startup Fordefi in a deal exceeding $100 million, aiming to boost its presence in decentralized finance and enhance custody infrastructure.
Key Takeaways
- Paxos acquired Fordefi for over $100 million, expanding its footprint in decentralized finance (DeFi) and institutional wallet technology.
- Fordefi, trusted by nearly 300 global institutions, will bring advanced MPC wallet tech and deep DeFi integrations to Paxos’ regulated platform.
- The acquisition strengthens Paxos’ custody and wallet infrastructure, enabling enterprises to securely engage with on-chain finance at scale.
- Paxos plans to expand its R&D operations in Tel Aviv, integrating Fordefi’s team and tech while continuing to offer independent services short-term.
What Happened?
Paxos, the regulated blockchain infrastructure provider behind major stablecoins like PayPal USD, has acquired Fordefi, a crypto wallet firm focused on institutional DeFi access. The deal, valued at over $100 million, brings Fordefi’s secure wallet infrastructure and client base into Paxos’ regulated platform. The move highlights increasing institutional interest in decentralized finance, once considered too risky for mainstream adoption.
Paxos is acquiring @FordefiHQ, the leading custody and wallet technology platform for on-chain operations.
— Paxos (@Paxos) November 25, 2025
This strengthens our ability to support institutions with more flexible and sophisticated digital asset infrastructure. pic.twitter.com/t7aFVhyflu
Paxos Strengthens Its Infrastructure With Fordefi Deal
The acquisition of Fordefi marks Paxos’ second major purchase in the last year, following its February acquisition of Membrane Finance in Finland. That move helped Paxos align with MiCA, the European Union’s digital asset regulations. Now, with Fordefi, Paxos adds a significant layer of wallet technology and security infrastructure tailored for on-chain operations.
Founded in 2021, Fordefi serves nearly 300 financial institutions and facilitates more than $120 billion in monthly transaction volume. Its secure wallet infrastructure, built on multi-party computation (MPC) and DeFi-native features, has made it a key player in institutional digital asset management.
Josh Schwartz, CEO of Fordefi, noted:
While Paxos will eventually integrate Fordefi’s technology into its infrastructure, the wallet firm will continue to operate independently for now. Customers will still have full access to Fordefi’s products without disruption during the transition.
A Strategic Bet on DeFi Demand
This acquisition underscores how institutional demand for DeFi access is maturing. Paxos CEO Charles Cascarilla acknowledged the shift, stating, “We certainly hear it all the time,” referring to client interest in DeFi capabilities.
In the past year, major platforms like Coinbase have introduced DeFi lending access, and global banks have started tokenizing traditional assets such as money-market funds. The Paxos-Fordefi union appears timed to meet this rising institutional appetite for regulated access to blockchain-based finance.
Fordefi’s MPC wallet infrastructure and policy engine align with Paxos’ offerings around regulated custody, tokenization, and payments. Cascarilla emphasized:
Fordefi’s Israeli R&D to Play Key Role
As part of the deal, Paxos plans to expand its research and development footprint in Tel Aviv, where Fordefi employs over 35 of its roughly 50 staff members. Dima Kogan, Fordefi’s co-founder and CTO, said all employees will stay on and continue building secure infrastructure solutions together with Paxos. Kogan added:
Fordefi has raised $28 million from major investors including Microsoft, PayPal, Lightspeed, and Pantera. The company will now operate under the Paxos umbrella, offering institutional clients a unified and secure path to interact with DeFi.
CoinLaw’s Takeaway
In my experience, major shifts in crypto infrastructure don’t always make headlines, but this one should. This deal isn’t just about buying wallet tech, it’s about meeting a serious demand from big institutions wanting to step into DeFi without compromising on security or compliance. Fordefi had already carved out a niche in on-chain institutional tools, and pairing that with Paxos’ regulatory muscle is a power move. I found Paxos’ plan to grow the Tel Aviv R&D hub especially smart. It keeps innovation close to the source while scaling globally. This is more than an acquisition. It’s Paxos doubling down on the future of institutional DeFi.
