Photo: PayPal News / Twitter
The tendency to join the crypto world either directly or indirectly became rather popular among more traditional businesses comparatively not so long ago but today nobody is surprised when some information of this kind appears here and there.
First Investment
This time online payments giant PayPal has made the community speak about it as it has taken a decision to make its first-ever investment in a blockchain technology company.
As it has been recently announced, the company joined the extension of Series A investment in Cambridge Blockchain. This startup is aimed at providing individuals and financial institutions with an opportunity to manage sensitive data with the help of shared ledgers.
It means that users are allowed to own their online identities without the involvement of intermediaries. PayPal is said to be also interested in such an approach and will consider a possibility to use the capacities of Cambridge Blockchain’s platform to help its users avoid sharing their personal data when it is really unnecessary.
Though it may be rather interesting, the investment amount hasn’t been disclosed. But from the recent filings with the SEC, it is known that the total sum raised by Cambridge Blockchain amounted to $3.5 million. This amount was brought by several investors during the past nine months. In May 2018, the startup closed its Series A with $7 million which means that all in all it has managed to raise $10.5 million.
A number of prominent investors, including HCM Capital, the VC arm of Foxconn and Digital Currency Group, took part in the first round that brought $7 million. This amount consisted of $3 million of converted notes and $4 million of new capital.
The rest of the above-mentioned amount of $10.5 million was invested by such companies as PayPal, Future/Perfect Ventures, Omidyar Network, the investment firm created by the founder of eBay, Flourish which is a financial inclusion investment wing of Omidyar.
A PayPal spokesperson commented on their role in the startup’s funding the following way:
“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.”
Before this investment, we’ve heard about PayPal in the context of blockchain rather rarely, for example, when it filed a patent in March 2018 to streamline cryptocurrency transaction rates and when it disclosed its intentions to implement an internal project aimed at promoting tokens usage among its employees.
Cambridge Blockchain’s Plans
Cambridge Blockchain’s CEO, Matthew Commons revealed that for the first time they interacted with PayPal in the framework of Fintech Europe 2018. It was an accelerator that was co-hosted by PayPal and its main aim was to provide support to early-stage startups under increasing regulatory requirements relating to the General Data Protection Regulation (GDPR) and other privacy considerations.
Now the startup plans to allocate the new capital to fund hires, further research and development. At the moment, Cambridge Blockchain is a team of 15 members, 11 of them work in Boston and are dealing with technical issues. One team member that has recently joined the company works in Beijing. And three specialists have been hired in Paris, they are responsible for the launch of their technology in Luxembourg (where PayPal has an office) which is said to take place later this year.
