PayPal Eyes Buying Crypto Firm BitGo, Others

PayPal is looking at acquisition possibilities for cryptocurrency companies, including bitcoin custodian BitGo, a report from Bloomberg says.

The move would help PayPal boost its embrace of digital coins. The company recently announced that users can buy, sell and hold digital coins including bitcoin, Ether, Bitcoin Cash and Litecoin from digital wallets, and also use that money to shop at any of the merchants in its network by early next year, Bloomberg writes. With that announcement, bitcoin surged past $13,000 for the first time since July of last year.

According to sources quoted by Bloomberg, PayPal has had discussions with BitGo, which helps store bitcoin in a safe manner. A deal might be reached in the coming weeks, though nothing has been set in stone yet and talks might collapse. PayPal might also go with another target to purchase.

It’s unknown how much PayPal might pay to buy BitGo.

BitGo raised $58.5 million in 2018 and was valued at $170 million, according to PitchBook.

Mike Belshe, BitGo’s chief executive officer, founded the company in 2013 to offer highly secure digital wallets for crypto, which need multiple signatures for transactions. The company also offers offline vaults to store bitcoin and other such currencies, Bloomberg writes, and it was one of the first companies to focus on institutional investors, its website says.

In August, BitGo applied to New York regulators to become an independent, regulated qualified custodian under the state’s banking laws.

PayPal has said it plans to partner with BitGo competitor Paxos Trust Company, which is a regulator and provider of cryptocurrency products and services, Bloomberg writes.

PayPal’s forage into digital currencies comes as digital payments in general are seeing a big boost because of the pandemic’s wide turn toward digital means to make payments for all kinds of daily life activities. PayPal President and CEO Dan Schulman called the shift “inevitable.”