Competition and consolidation are heating up in the interbank blockchain space.

Chain, a startup that raised more than $40 million from the likes of Fiserv and Citigroup, has been acquired by Lightyear.io, a company that works on the Stellar interbank blockchain, the companies announced today. Chain and Lightyear will combine to form a company called Interstellar. Terms of the deal were not disclosed.

The move is a major boost to Stellar, which competes with Ripple and R3’s Corda in providing an interbank system for managing assets.

Stellar is a not-for-profit, open-source payment network that runs on proprietary tokens called lumens. It was co-founded in 2014 by Jed McCaleb, who also co-founded Ripple and Mt. Gox. Lightyear was founded as a for-profit endeavor, also by McCaleb, for the purpose of working on Stellar.

Adam Ludwin, CEO of Chain, noted all of his employees would move to Instellar, as would customers and products, though Chain’s networks tended to be private. Chain’s customers include the world’s largest payment network, Visa. Ludwin has repeatedly said he finds public blockchains “more interesting,” including at Bank Innovation 2018.

From Reuters:

“We were looking for a way to help our customers move the projects that we have been working on from a private network to a public one,” Ludwin said.

“When we started a few years ago, our customers were not ready for a public network. Fast forward to three years, they’re willingness has gone up, and the maturity of the public networks has changed a lot,” he added.

Ludwin will serve as CEO of the combined company, he told Bank Innovation via email. McCaleb will serve as CTO.

Dan Rosen, general partner at Commerce Ventures, said to Bank Innovation, “In our view, the Chain-Lightyear deal is an exciting opportunity to bring enterprise blockchain technology, team, and customers to the Stellar community and public blockchain. As investors in Lightyear (now InterStellar), we look forward to working with Adam, Jed and the entire team to help them be successful.”

Stellar received another piece of good PR recently when IBM, a member of the Hyperledger consortium, announced it would build a payments network on Stellar technology.

Interstellar will apparently use assets from both companies in whichever context is appropriate. “What you’re going to see from Interstellar is a convergence of the two,” Ludwin said. “Where it makes sense to have assets in a private environment, we’ll use Chain’s products, when it makes sense for these assets to be transferred over a network, we’ll use Stellar.”

1) I’m thrilled to share that Chain is joining forces with Stellar!

Official announcement: https://t.co/6YEK82gJ50

This thread explains why we did it.

— Adam Ludwin (@adamludwin) September 10, 2018