Despite the strong competitive placement of cryptocurrencies to the products and services offered by Paypal, the company has almost entirely stayed out of the burgeoning industry. Whereas other digital payment processing companies such as square have taken strong steps to embracing growth of cryptocurrencies and blockchain technology with acquisitions and integration of cryptocurrencies themselves, Paypal has reported almost no serious development.
Last year the company began experimenting with an in-house blockchain based app that operates similar to something like Venmo. The app facilitates an employee reward system via a digital work space, where the in-house currency can be used for specific business related activities or traded with other employees, but cannot be exchanged for fiat currency. They are valid for over 100 different rewards or experiences with Paypal Executives, such as poker tournaments, martial arts classes or dog walks.
Cambridge Blockchain Data Services
Other than the employee rewards network, Paypal has recently invested a small sum in a company using blockchain technology to facilitate management of sensitive data, with a focus on financial institutions. This is the first cryptocurrency of blockchain technology related investment Paypal has been reported to make, and is part of Cambridge Blockchain’s series A funding. The round included input from HCM Capital, The Digital Currency Group and Omidyar Network, totalling $10.5 million.
“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.” - Paypal Spokesperson
PayPal’s Luxembourg Growth
The relationship began last year at the Fintech Europe 2018 accelerator program where Cambridge Blockchain first formed. The program is sponsored by Paypal and highlights Paypal’s growing interested in the UK and Luxembourg, where the program’s conferences took place. Paypal recently moved their European headquarters to the city and has already been granted a banking license from the country’s financial regulators. Further, Cambridge Blockchain has been working with LuxTrust, a startup which is perfectly situated to help their services, as well as Paypal’s interests. LuxTrust is backed by the government of Luxembourg and financial institutions in the region.
“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.” - Cambridge Blockchain CEO Matthew Commons
By: BGN Editorial Staff