PayPal Makes its First Blockchain Investment

Date: 
April 03, 2019
Read time: 
2 minutes

In a major move that is helping to further foster trust in blockchain technology and the crypto-economy, the online payment giant PayPal just announced that they have made their first investment in a blockchain startup during the Series A funding round for the company.

In a major move that is helping to further foster trust in blockchain technology and the crypto-economy, the online payment giant PayPal just announced that they have made their first investment in a blockchain startup during the Series A funding round for the company.

If you are looking to help get some traction for a distributed identity system, it’s great to have a partner like that. (Matthew Commons - CEO of Cambridge Blockchain,)

The blockchain startup, Cambridge Blockchain, is a startup that is designed to major financial institutions, as well as other companies, manage their sensitive data using shared ledgers.

While neither PayPal or Cambridge Blockchain have disclosed the amount that the financial giant invested into the company, reviews of their recent SEC filings suggest that PayPal belongs to the 3.5 million that was raised in the past nine months. While the PayPal investment is not significant monetarily, it does help to improve the overall reputation of crypto and blockchain. In fact, a PayPal spokesperson recently released this statement to CoinDesk regarding the investment:

We made an investment in Cambridge Blockchain because it is applying blockchain for digital identity in a way that we believe could benefit financial services companies including PayPal. Our investment will allow us to explore potential collaborations to leverage blockchain technology.

As it turns out, PayPal’s investment in Cambridge Blockchain is not the first interaction that it has had with the company over the past year. Their relationship began during the Fintech Europe 2018 accelerator program hosted by PayPal, where the startup made an appearance. In addition, Cambridge Blockchain has been working with the Luxembourg-based finance company LuxTrust, where PayPal has coincidentally moved their European headquarters. This is reportedly one of the driving forces that encouraged the startup to start working with PayPal’s corporate venture group in San Jose and allowed for the investment to take place.

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It is certainly easy to see why PayPal made the leap, however. The startup’s main focus is based on the onboarding of personal data and making it easier for companies to comply to KYC rules and regulations so that they can open accounts with other banks and financial service providers. At the moment, Cambridge Blockchain is a part of the Decentralized Identity Foundation and has managed to successfully navigate the strict European regulations to better provide for their clients.

These qualities make it an extremely useful service for PayPal considering it handles hundreds of millions of accounts. The CEO of Cambridge Blockchain, Matthew Commons, considers it an honor as PayPal has already reviewed quite a few similar startups while searching for the same solutions. He wrapped up his statement with CoinDesk by saying:

“If you are looking to help get some traction for a distributed identity system, it’s great to have a partner like that.

 

Posted by R.R. Hauxley

R.R. Hauxley traveled around the world ... 1 year on 1 Bitcoin. 20 countries, 12 months, 1 Bitcoin. He wrote a book about it: Stolen Wallets and Where to Buy Them. Along the way he met and interviewed the sharpest, brightest minds in crypto today: Vitalik Buterin, Charlie Lee, and more. Today Rafael educates the crypto curious and delves further into the incredible world of blockchain.

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