PayPal Starts Acquisition Talks with BitGo, Other Crypto Startups

The payment company will introduce crypto services on its platform in the ‘coming weeks’.

A couple of days after the official declaration of plans for enabling crypto services, PayPal Holdings is now eying to acquire cryptocurrency companies to bolster its position in the industry.

Citing anonymous sources, Bloomberg reported on Friday that the payments giant is considering to acquire several companies, the most notable one being BitGo. 

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PayPal already started talks with BitGo, and the deal could be sealed within weeks. However, the deal might not materialize if the payments company sees value in other companies on its list, the source added.

It is not clear how much PayPal is willing to pay for BitGo.

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Established in 2013, BitGo made its name as a crypto custodian. Later, the company expanded its services and started offering crypto lending and brokerage services. The startup raised $69.5 million to date, according to Crunchbase, and closed its Series B round last year with a valuation of $170 million.

Investors in the company include Goldman Sachs Group, Craft Ventures, Digital Currency Group, DRW, Galaxy Digital Ventures, Redpoint Ventures, Valor Equity Partners, and Founders Fund.

PayPal and Crypto

PayPal’s interest in BitGo was revealed after the payments giant officially announced its intention to allow digital currency buying, selling, and holding services on its platform. This is a major boost for the mainstream adoption of cryptocurrencies, given PayPal’s massive global user base.

Initially, the services will be available only to the US-based users with only four major cryptos – Bitcoin, Ethereum, Bitcoin Cash, and Litecoin – but the company has plans to expand its geographical reach and listings as well. Additionally, it will allow crypto payments to all 26 million merchants within the payment network.

Interestingly, PayPal is using the services of Paxos, a competitor of BitGo, to offer its crypto-based services.

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