PayPal Makes Move into DLT Domicile with Cambridge Blockchain Project Investment
No longer the underdog of the business world, Blockchain firms are not only attracting a lot of investment from big firms but are also getting acquired by them. An example of this is Facebook acquiring a Blockchain startup, earlier this year, though the move was mostly seen as a means of getting access to their staff.
Now, PayPal has joined the bandwagon by making its first official investment in a Blockchain firm. The announcement was made on April 2, 2019 and revealed that PayPal has joined the Series A funding round for Cambridge Blockchain. Cambridge Blockchain is a firm that specializes in the use of Blockchain to manage their sensitive data through the use of Blockchain.
The final details of the backing on the part of PayPal were not made public, but it is known that $3.5 million was raised by Cambridge Blockchain from its investors in the last nine months on top of the $7 million which was raised in its series A funding last year, bringing their total funding to $10.5 million.
The $7 million initially raised came from investors such as HCM Capital, the VC arm of Foxconn, and the Digital Currency Group In form of New Capital and converted motes. The new $3.5 million raised came from PayPal, the Omidyar Network, the philanthropic investment firm, Flourish, Omidyar’s financial inclusion investment spinoff; and Future/Perfect Ventures.
PayPal stated in an email to CoinDesk that they made an investment in Cambridge Blockchain because they are creating services that their firm could find helpful.
“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,” they said.
While this round of investment is the first public linking of the two firms, Cambridge Blockchain CEO Matthew Commons has clarified that they two firms have been in contact for the last year or so. For example, Cambridge Blockchain was part of the “Fintech Europe 2018” program which was sponsored by PayPal.
They also have a link through banking as Cambridge Blockchain has a relationship with LuxTrust, which receives support from the government of Luxembourg. PayPal now has their european headquarters in Luxembourg and just got their banking license there.
“We can’t talk specifically about anything commercially that we are doing because it’s all sort of exploratory now, but I think the fact that we are deployed in Luxembourg and they [PayPal] have a major presence there also helped to get things moving,” said Commons.