Online payments company, PayPal has made its first-ever investment in a blockchain company.
Announced last week in a press release, PayPal has joined a Series A Investment Platform in Cambridge Blockchain, a start-up that helps financial institutions manage sensitive data using shared or distributed ledgers.
Cambridge blockchain project aims to give individuals a way to own their personal data and online identities without third parties like Facebook, just the same way bitcoin allows its users complete control to store value without middlemen institutions.
The Cambridge Blockchain initiative seeks to provide an independent platform for institutions of finance like banks, exchanges and of course PayPal which all require user identification for their services.
For PayPal, this will provide a platform to explore and leverage blockchain technology in financial applications especially in areas of digital identity services.
Speaking on its part in the investment fund, a PayPal spokesperson remarks:
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.
Although the investment amount was not disclosed, a recent filing with the US SEC indicates that the Cambridge Blockchain has raised a capital of about $3.5 million.
Additionally, the Cambridge Blockchain is backed by Digital Currency Group and is a member of the Decentralized Identity Foundation a non-profit organization which features Microsoft, Mastercard, IBM and other firms as members. The foundation aims to build an open ecosystem where individuals can share in the revenue generated from their own identities or pick up the info and take it elsewhere.
See more details on Cambridge Blockchain here: https://www.cambridge-blockchain.com/
PayPal, Cryptocurrency and Blockchain
Despite initial backlash of cryptocurrency by former CEO of PayPal – Bill Harris and with no outspoken stance on cryptocurrency by the firm, this blockchain investment and other pointers such as co-founder Peter Thiel who has been enthusiastic about cryptocurrency as well as former PayPal President David Marcus now currently heads Facebook’s blockchain division; all these point to a welcome approach to the blockchain industry.
It will also be recalled that in 2016, PayPal had struck a deal with Coinbase which allowed users sell Bitcoin on Coinbase and receive resulting payments to their PayPal account.