PayPal rumored to be eying acquisition of crypto custodian BitGo


PayPal changed its mind about buying crypto custodian BitGo

  • PayPal refused to buy custodian BitGo

  • The reason for the failure of the deal is not named

  • The head of BitGo admitted that so far the company does not reach payback

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American payment giant PayPal refused to buy one of the largest cryptocurrency custodians BitGo

Largest e-payment provider PayPal won’t buy crypto custodian BitGo.

PayPal changed its mind about buying crypto custodian BitGo

This is reported by Fortune, citing sources close to the deal.

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The reason for the failure is not named, but in an interview with Fortune, BitGo CEO Mike Belsh said that so far the custodian is not making a profit, as it is in “growth mode”.

PayPal changed its mind about buying crypto custodian BitGo

Belsh also added that BitGo has no plans to raise capital in the near future..

The possible purchase amount of BitGo remained unknown, however, according to the PitchBook service, BitGo raised $ 58.5 million in 2018 with an estimate of $ 170 million.

Fixed chest

BitGo’s custodian is among the many companies that have benefited from the current bullish Bitcoin rally, says BitGo CEO.

PayPal changed its mind about buying crypto custodian BitGo

However, Belsh acknowledges that the cryptocurrency industry has faced regulatory challenges as giants like PayPal and Square enter the market. On moment of writing BitGo holds $ 16 billion worth of cryptocurrencies, making the custodian one of the largest in the market.

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The first news about a possible takeover of BitGo appeared at the end of October. Then it was reported that PayPal is exploring the possibility of acquiring BitGo as part of a course to expand support for cryptocurrencies. PayPal itself declined to comment on rumors of a deal breakup.

In addition to being one of the largest custodians, BitGo is also the largest custodian of the Wrapped Bitcoin (WBTC) bitcoins tokenized on the Ethereum blockchain. For 2020, the custodian reported a balance of 78 thousand WBTC (~ $ 1.8 billion at the current exchange rate). At the same time, in August alone, Alameda Research generated 14 654 WBTC, which at that time was almost 70% of the issued bitcoins in the Ethereum network in a month.

BitGo Custodian founded in California in 2013.

PayPal changed its mind about buying crypto custodian BitGo

The company is focused on providing services for the storage of cryptocurrencies in digital wallets with multi-signatures, as well as offline storage.

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