During the recent weeks there has been numerous reports that Paypal wants to buy different crypto companies including BitGo, in an attempt to grow the company’s embrace of digital currencies. People close to the company have confirmed the news.
PayPal is already having negotiations with BitGo, a business that lets investors safely store Bitcoin, which could enter an agreement in weeks, the people close to the company added, requesting not to be identified since this matter is confidential. Negotiations could also break apart and, the individuals added, PayPal could choose to buy different targets.
It is not known exactly how much PayPal would pay for BitGo if the deal went forward. At a $170 million estimate, BitGo raised around $58.5 million in 2018, as per PitchBook. Representatives of both PayPal and BitGo refused to comment on this matter.
BitGo is a Palo Alto California-based company founded by Chief Executive Officer Mike Belshe in 2013. It provides digital wallets involving numerous transaction signatures, and also offline vaults to store Bitcoin and competitor currencies. As per its website, it was among the first firms in that space to rely on institutional buyers.
A press statement showed that the firm applied in August to New York authorities of becoming an independent, supervised licensed custodian under New York State Banking Legislation. Custodians are liable for using encrypted storage to protect digital assets.
On Wednesday, PayPal revealed that its clients will acquire, sell and retain cryptocurrencies via digital wallets, such as Bitcoin, Litecoin, Bitcoin Cash and Ether, and also use the virtual currency to buy at its network of 26 million retailers. For the very first time after July 2019, the news led Bitcoin to rise past $13,000.
PayPal said that it would work with BitGo rival Paxos Trust Company, a controlled distributor of its own service for cryptocurrency services and products.
BitGo is funded by investors such as Goldman Sachs Group Inc., Digital Currency Group, Craft Ventures, Galaxy Digital Ventures, DRW, Redpoint Ventures, Founders Fund, and Valor Equity Partners.