Key Highlights
Payward acquires Magic Labs’ embedded wallet operations
Company undergoes rebrand to Newton Labs with new strategic direction
Existing wallet users to migrate to Payward Services platform
Newton Protocol emphasizes pre-settlement compliance and authorization
Kraken parent continues aggressive crypto infrastructure acquisition strategy
In a significant restructuring move, Magic Labs has finalized an agreement to divest its embedded wallet operations to Payward, which operates the prominent cryptocurrency exchange Kraken. Through this asset divestiture, wallet services will transfer to Payward Services, while Magic Labs undergoes a complete transformation into Newton Labs. This strategic pivot redirects the company’s attention toward building onchain finance infrastructure and simultaneously strengthens Payward’s comprehensive digital asset ecosystem.
Strategic divestiture enables focused pivot to Newton Protocol development
The deal follows an asset divestiture framework instead of a full corporate consolidation. Both entities will maintain independent operations as distinct organizations. Current wallet users will migrate to Payward Services following transaction completion.
Magic Labs has generated over 60 million embedded wallets since its 2018 inception. The company has cultivated a developer community exceeding 200,000 users spanning consumer and enterprise environments. These offerings positioned Magic Labs as a prominent embedded wallet infrastructure provider in the blockchain space.
Following completion, Magic Labs will adopt the Newton Labs identity. The organization will dedicate all resources toward advancing the Newton Protocol for onchain financial services. This protocol implements compliance verification, security measures, identity authentication, and risk assessment before blockchain transactions finalize on-chain.
Newton Labs pursues enterprise-grade onchain finance solutions
Newton Labs introduced the Newton Protocol mainnet beta in June 2026. This platform establishes an authorization framework that validates transaction prerequisites before execution. Enterprises can implement custom policy rules directly into transaction processing workflows.
VaultKit represents the inaugural protocol-powered offering, designed for institutional digital asset custody needs. This solution delivers modular policy enforcement spanning regulatory compliance, identity validation, security protocols, and transaction risk assessment. Financial institutions can establish automated governance controls preceding blockchain settlement.
Newton Labs has outlined plans to extend protocol functionality into stablecoins, tokenized real-world assets, and autonomous finance platforms. The company aims to facilitate chain unification and minimize fragmentation across diverse blockchain ecosystems. Its ongoing partnership with Polygon AggLayer continues advancing cross-chain infrastructure capabilities.
Payward pursues aggressive acquisition strategy across crypto sector
This acquisition represents another addition to Payward’s ambitious expansion campaign throughout 2026. Earlier in the year, the organization finalized its purchase of Bitnomial for a total consideration reaching $550 million through combined cash and equity. Additionally, Payward announced plans to acquire Hong Kong-headquartered stablecoin payment company Reap Technologies for roughly $600 million.
Additional acquisitions encompass Backed Finance and Magna, expanding Payward’s footprint across tokenized asset infrastructure and token administration platforms. The Magic Labs acquisition contributes battle-tested embedded wallet technology with demonstrated scalability and developer engagement. Collectively, these strategic additions enhance Payward’s service portfolio across regulated exchange operations, payment processing, custody solutions, and foundational blockchain infrastructure.
Specific financial details regarding the Magic Labs asset purchase have not been publicly disclosed. Nevertheless, the company previously secured $52 million in capital with PayPal Ventures serving as lead investor, demonstrating substantial institutional confidence prior to this transaction. This restructuring enables Magic Labs to channel full attention toward authorization infrastructure development while Payward consolidates its position as a comprehensive crypto services provider.
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