PayPal Looking To Buy Bitcoin Custodian BitGo Inc.
After announcing its foray into the Bitcoin space, PayPal is looking to expand its cryptocurrency offerings by acquiring Bitcoin custodian BitGo.
Bitcoin custodian BitGo Inc. is first on PayPal’s wanted list according to PayPal insiders, and it’s believed that talks are already at an advanced stage.
Talks are still ongoing, but it’s believed that PayPal is looking at other crypto firms to buy.
Although there’s no information on the size of the deal, it’s expected PayPal would have to pay more than Bitcoin custodian BitGo’s estimated $170 million valuation.
What is BitGo Inc.?
Founded by Mike Belshe, Ben Davenport, and Will O’Brien in 2013, BitGo Inc. is headquartered in Palo Alto, California.
BitGo is one of the leading Bitcoin security platforms, and is a pioneer of multi-sig technology. The company offers an enterprise-grade, multi-sig, multi-user Bitcoin wallet, as well as API access to its underlying security platform.
The Bitcoin custodian includes investors, such as including Goldman Sachs Group Inc., Galaxy Digital Ventures, Craft Ventures, Digital Currency Group, DRW, Redpoint Ventures, Valor Equity Partners and Founders Fund.
BitGo’s is one of the oldest crypto companies and its Bitcoin custody service is one of the most secure in the space.
The Bitcoin custodian focuses mostly on the institutional space. As well as offering offline cold storage in vaults, BitGo’s digital hot wallets require multiple signatures to carry out transactions.
In August 2020, BitGo applied to the New York State Department of Financial Services (NYDFS) to become a qualified cryptocurrency custodian in New York State.
The licence application to operate as an independent, regulated qualified custodian is commonly known as BitLicence. If accepted it will give BitGo access to the world’s leading institutional investors, as interest in Bitcoin from the leading institutions begins to snowball.
PayPal has already obtained the New York BitLicence, however, so any acquisition could see PayPal become an institutional Bitcoin custodian, as well as its other cryptocurrency services.
The payment giant announced on Wednesday that its customers can buy, sell and hodl Bitcoin, Ethereum, BCash, and Litecoin within its payment platform.
PayPal said it was rolling out in the US in the coming weeks, and other crypto friendly countries early 2021. And PayPal’s users will be able to spend their cryptocurrencies at any of PayPal’s 26 million merchants within its network.
Payment Giant PayPal Won’t Stop There
The news that PayPal is looking to expand its cryptocurrency services comes as no surprise.
With the speed of innovation on Bitcoin and other decentralized platforms, the payments giant knows if it doesn’t act, it will be left behind by the likes of Jack Dorsey’s Square Inc.
PayPal is set to offer a Bitcoin trading and shopping service for its already 350 million users. And if it acquires BitGo, it will be moving into the institutional custody space at probably the most strategic time in Bitcoin’s short history.
PayPal has made its initial move, and will keep expanding. The question is, who will be next?
Author: Tommy Limpitlaw
How can I buy Bitcoin in The Netherlands?
There are many exchanges operating in the Netherlands. However, the most recommended exchanges are Kraken or Blockfi. Or you can buy Bitcoin from Bitcoin marketplaces, such as LocalBitcoins or Paxful. All of these exchanges and marketplaces are global with high liquidity and excellent customer service. Feel free to read the reviews of each one.
Can you buy less than 1 Bitcoin?
Yes. Every Bitcoin can broken down into 100 million bits. They are known as satoshis, after the pseudonymous creator Satoshi Nakamoto. And some companies will let you buy as little as $1 worth of Bitcoin, which at time of writing is worth about 11,000 satoshis. There are many companies that have a system for dollar cost averaging (DCA). This is a great way to buy Bitcoin, and is known in the space as ‘Stacking Sats’. Basically, what you do is set up small automatic, recurring payments to buy Bitcoin (or sats), and you DCA over time.
What is the point of Bitcoin?
Bitcoin is a decentralized money. A money that nobody can control or manipulate, and a money that nobody can print and devalue. It’s also not necessary for any third party to verify transactions, so it makes it much faster and cheaper to send value. It’s also money built on the Internet: a society of almost 5 billion people.
What price will Bitcoin reach?
There have been many price predictions ranging from $0 to tens of million per Bitcoin. But the truth is, nobody knows for sure. However, it is the soundest and hardest money ever created. Many say it is digital gold, but I believe in the digital age, it is more useful than gold. So, let’s say Bitcoin reaches the market cap of gold, which is believed to be $10 trillion, each Bitcoin would be worth $500,000. Is that reachable? Absolutely! Will it be plain sailing? Absolutely not!