Kraken's Payward Acquires Magic Labs' Wallet Infrastructure Supporting 60M Users

Key Highlights

Table of Contents

On July 27, 2026, Payward—the company behind Kraken—announced plans to purchase Magic Labs’ wallet-as-a-service operations
The acquired infrastructure currently supports more than 60 million self-custody wallets and has facilitated $10 billion in stablecoin activity
This transaction integrates embedded wallet capabilities into Payward Services, the firm’s enterprise-focused platform
Magic Labs is transitioning to Newton Labs as a separate entity, concentrating efforts on its Newton Protocol initiative
Customer transitions to Payward Services begin August 1, requiring no manual intervention from existing users

In a strategic move to expand its enterprise offerings, Payward—Kraken’s parent organization—has entered into an agreement to purchase the wallet-as-a-service division of Magic Labs. The July 27 announcement outlined an asset acquisition structure, targeting Magic’s embedded wallet platform rather than acquiring the company outright.

Kraken Parent Acquires Magic Labs’ Embedded Wallet Business
According to The Block, Kraken parent Payward acquired Magic Labs’ embedded wallet business through an asset purchase. The business will move to Payward Services, while Magic Labs will become Newton Labs and focus on… pic.twitter.com/4958cDTUXY
— Wu Blockchain (@WuBlockchain) July 27, 2026

Neither party revealed the purchase price. Both organizations anticipate finalizing the deal in the coming weeks, pending typical closing requirements.

Magic Labs’ Infrastructure Capabilities

Since its 2018 inception, Magic Labs developed technology that now underpins more than 60 million self-custody digital wallets. The platform has attracted over 200,000 developers and facilitated transactions exceeding $10 billion in stablecoin value.

This infrastructure will be integrated into Payward Services, Kraken’s enterprise-grade platform. The existing platform already provides trading infrastructure, custody solutions, tokenized asset services, derivatives products, and fiat conversion capabilities.

By incorporating wallet infrastructure, Payward’s enterprise clients gain the ability to embed self-custody wallet functionality directly within their proprietary applications. This eliminates dependency on external wallet service providers.

Magic’s technology framework features a trusted execution environment for transaction signing, an embedded integration framework, and a comprehensive software development kit for developers.

The platform offers non-custodial wallet solutions, ensuring end users maintain complete control over their digital assets. Specific blockchain support and user interface details will depend on individual business implementations.

According to Newton Labs CEO Sean Li, existing Magic customers will transition to Payward-managed services beginning August 1. All current implementations will maintain uninterrupted operation throughout the transition.

Magic Labs Rebrands, Pivots to Newton Protocol

Following the asset sale, Magic Labs has undergone a rebrand to Newton Labs and will operate independently. The company’s primary focus shifts to Newton Protocol, which launched its mainnet beta phase on June 23.

Newton Protocol functions as a pre-transaction verification layer, evaluating whether transactions align with established security parameters, identity requirements, compliance standards, and risk thresholds before blockchain settlement. The system generates cryptographic proof of each policy evaluation.

VaultKit, the protocol’s inaugural offering, enables decentralized finance vault administrators to implement policy enforcement on operational decisions. The product currently operates on Ethereum and Base networks, featuring partnerships with RedStone, Credora, Webacy, and Chainalysis Hexagate.

Newton Labs has outlined ambitions to extend beyond vault management into stablecoin infrastructure, tokenized traditional assets, and autonomous financial systems. These applications represent planned developments rather than current deployments.

Prior to this transaction, Magic had secured more than $80 million in venture funding, including a $52 million financing round spearheaded by PayPal Ventures in May 2023.

Payward’s Continued Acquisition Strategy

The Magic Labs transaction represents another chapter in Payward’s aggressive expansion campaign. Earlier acquisitions include CFTC-regulated derivatives platform Bitnomial for as much as $550 million in May, and Hong Kong-based stablecoin payment processor Reap in July.

Additional notable purchases include retail futures trading platform NinjaTrader for $1.5 billion in 2025, and tokenized securities provider Backed Finance for an undisclosed sum.

Collectively, these strategic acquisitions position Payward across multiple cryptocurrency sectors including spot trading, wallet technology, payment processing, institutional custody, derivatives markets, and tokenized asset infrastructure.

As both Payward and Newton Labs operate as private companies, no public market response metrics are available regarding this transaction.