S&P Global (SPGI) has agreed to acquire OpenZeppelin, the smart contract security firm whose open-source code library sits behind more than $37 trillion in transferred value, and will run the auditor as a standalone business unit under its own name.

Founded in 2015, OpenZeppelin pairs security assessments and secure development services for decentralized finance (DeFi) protocols and traditional financial institutions with OpenZeppelin Contracts, a free library of standard token and contract implementations that the vast majority of the largest stablecoins and tokenized funds are built on.

The $37 trillion counts cumulative value moved through contracts built with that library, according to the announcement. OpenZeppelin has run more than 900 security engagements, including a late-2021 review that flagged a bug putting $15 billion in Convex Finance deposits at risk before it was patched.

“Our digital assets strategy centers on bringing trusted data, benchmarks and transparent risk assessment to markets as they move onchain,” said Yann Le Pallec, President of S&P Global Ratings.

Le Pallec stated that OpenZeppelin will complement the company’s smart contract and onchain technology risk assessment capabilities, giving traditional institutions and DeFi-native firms “the confidence to build and transact in this new environment.”

OpenZeppelin Keeps Its Name and CEO

OpenZeppelin will continue operating as its own unit inside S&P Global, with CEO Demian Brener staying in charge and reporting to Le Pallec. Financial terms were not disclosed, and S&P Global said the purchase is not expected to have a material impact on its financial results.

“OpenZeppelin’s standards, technology, and expertise already power the infrastructure behind the world’s leading stablecoins, tokenized funds, DeFi protocols, and onchain markets,” said Demian Brener, CEO of OpenZeppelin. “With S&P Global, that foundation reaches a broader set of organizations entering this market, as well as the blockchain networks and DeFi protocols gaining institutional adoption.”

Jefferies is serving as financial advisor to S&P Global, with Clifford Chance as legal counsel. FT Partners advises OpenZeppelin on the financial and strategic side, and Cooley on legal.

Deal Lands Amid Tokenization Push

S&P Global’s index arm has published crypto benchmarks since 2021, when S&P Dow Jones Indices launched a broad market index tracking more than 240 coins alongside its dedicated Bitcoin and Ethereum gauges, with pricing data supplied by Lukka.

On the same day as the acquisition, the US Securities and Exchange Commission (SEC) opened the door to secondary trading of tokenized US stocks through a temporary innovation exemption that requires the smart contracts involved to be publicly auditable and to run on public, permissionless blockchains.

Source: CryptoPotato