PayPal is currently in talks to acquire cryptocurrency companies including crypto custodian provider BitGo, as reported by Bloomberg today. The announcement comes a day after the e-payment giant announced on offering buying and selling of cryptocurrencies by 2021.
Possible Deal “Within Weeks” by PayPal
As per the report, PayPal is rumored for a possible acquisition of crypto custodial BitGo Inc. with a deal possible within weeks.
A crypto custody company is where a brokerage or financial institution holds securities on behalf of their clients for risk reduction and security. Founded in 2013, BitGo custodian was the first crypto company in the U.S. to secure a broker-dealer approval, registration for a transfer agent, and recognized as a trusted company. This alone made the company one of the first few in the U.S. to offer crypto custodian service. In 2018, the crypto firm raised $15 million in a round led by Goldman Sachs and Galaxy Digital.
BitGo offers an enterprise-grade “multi-sig” cryptocurrency wallet. The abbreviation stands for multi-signature. It requires transactions to have two or more signatures before an execution that works as a security layer blanket for risk reductions.
Acquisition Price Not Known Yet
While the exact acquisition price is not yet known. BitGo last raised $57.5 million in 2018 on a valuation of $170 million. Moreover, as cryptocurrency markets have matured, the acquisition figure would definitely be higher today.
Bloomberg further noted, BitGo isn’t the only crypto company to be under the eyes of PayPal. The company is looking at other acquisitions also. It’s not exactly known which companies are in plan for acquisition. But there is no dearth of crypto startups in the industry that could be appealing to PayPal. If the rumored news to acquire BitGo comes out true, PayPal would presumably be looking for those crypto firms that can provide complementary services to its recent announcement on crypto offerings.