2 days ago
M&A News: Circle Acquires Malachite from Informal Systems
Blockchain infrastructure company Informal Systems announced that Circle Internet Group (CRCL), a global financial tech firm, has acquired its high-performance consensus engine, Malachite. This technology will be used to help power Circle's upcoming blockchain project, Arc1, which is a new Layer-1 network specifically built for stablecoin-based financial applications. Arc is expected to launch in testnet later this year.
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It is worth noting that Malachite uses a Byzantine Fault Tolerant approach that is based on the Tendermint algorithm to make sure that decentralized environments are reliable. It was built to be flexible and reusable for real-world blockchain applications, and now Circle hopes to scale it globally. Importantly, Malachite will remain open source under the Apache 2.0 license in order to encourage collaboration and innovation across the industry.
Interestingly, this acquisition fits Informal's strategy of incubating new technologies and spinning them off for growth. Several members of the Informal team will join Circle to help build Arc, while Informal continues supporting other uses of Malachite. Unsurprisingly, Informal's management team sees this transition as a win for both sides, as it allows the technology to find meaningful real-world use while allowing Informal to keep improving the blockchain ecosystem.
Is CRCL Stock a Good Buy?
Turning to Wall Street, analysts have a Hold consensus rating on CRCL stock based on five Buys, six Holds, and four Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average CRCL price target of $174.64 per share implies 20.4% upside potential.
