Magic Labs sells its embedded wallet unit to Payward (Kraken parent) and rebrands as Newton Labs, targeting institutional blockchain compliance. The deal adds 60 million wallets to Payward's infrastructure.
Alpha Score of 61 reflects moderate overall profile with moderate momentum, strong value, moderate quality, moderate sentiment.
Magic Labs has agreed to sell its embedded wallet business to Payward Services, the parent of Kraken, and will rebrand as Newton Labs to focus on institutional onchain finance. The asset sale, announced Thursday, transfers the company's wallet infrastructure and user base to Payward while Magic Labs itself pivots to building a compliance-first authorization layer for blockchain transactions.
As part of the deal, current wallet users will migrate to Payward Services. The two companies will remain independent after the transaction closes. Financial terms were not disclosed.
Magic Labs had built a significant footprint since its founding in 2018, deploying more than 60 million embedded wallets and attracting a developer community of over 200,000. The wallet technology was used across consumer and institutional applications, making it one of the larger independent wallet infrastructure providers in crypto.
After the sale, the company will operate as Newton Labs, focusing entirely on the Newton Protocol, which launched its mainnet beta in June 2026. The protocol introduces an authorization framework that validates transaction prerequisites – such as compliance checks, identity verification, and risk assessment – before a blockchain transaction is finalized. The first product built on top of it is VaultKit, an institutional custody solution that lets banks and financial firms embed their own policy rules directly into the transaction pipeline.
Newton Labs said it plans to expand the protocol to stablecoin infrastructure, tokenized real-world assets, and autonomous finance applications. It also aims to improve cross-chain interoperability and reduce network fragmentation. The firm continues to work with Polygon AggLayer on that front.
For Payward, the deal is the latest in a string of acquisitions this year. The company previously bought derivatives platform Bitnomial for up to $550 million in cash and equity, and agreed to acquire Hong Kong stablecoin payment processor Reap Technologies for about $600 million. Other purchases include Backed Finance and Magna, expanding Payward's reach into tokenized securities and digital asset management.
The Magic Labs acquisition gives Payward a proven embedded wallet infrastructure with a large developer base and proven scalability, adding to its regulated exchange, payment processing, and custody offerings.
Magic Labs had raised $52 million in venture funding, led by PayPal Ventures, which signaled institutional confidence before the divestiture. The restructuring allows Magic Labs to pour all its resources into the authorization layer while Payward broadens its crypto services stack.
The transaction is expected to close in the coming months, subject to customary regulatory approvals.
Drafted by a large language model from the source reporting linked above, then screened by automated publishing checks. It is not read by a journalist before publication. Some articles cite our Alpha Score. Verify prices and figures against the original source. Educational coverage, not personalized advice.