Online payment company Paypal has made an investment in a blockchain startup that’s focused on identity technology. The investment is part of an extension of a funding round that raked in 7 million dollars back in May 2018. According to Forbes neither Paypal nor blockchain startup Cambridge Blockchain have disclosed details about the investment.
Paypal believes that the work of Cambridge Blockchain is useful for financial service companies. Applying blockchain for digital identity is something Paypal wants to use for its financial applications, but other companies can use the technology as well of course.
The investment from May 2018 came from VC firm Digital Currency Group, the VC division of tech manufacturer Foxconn and tech investment firm Partech Ventures. The extension of the investment round adds another 3.5 million dollars to the Cambridge Blockchain bank account, and it’s not known if the Paypal investment is part of that amount or not.
Even though Cambridge Blockchain isn’t a well known company, it did join major players like Microsoft, IBM, Mastercard and Accenture in a collaboration for researching digital identity on the blockchain. The organization that was formed, is called Decentralized Identity Foundation.
Besides Cambridge Blockchain there are plenty of other startups busy with blockchain technology and identity. Civic is working on identity verification for example, while Metadium’s identity software was recently added to the Unity Asset Store.
Paypal has been talking about cryptocurrencies in the past. Co-founder Luke Nosek told that the company initially would develop its own currency independent from banks and governments, but this plan has been sidelined in favor of the current system.
Even though blockchain technology can be useful for Paypal, the rise of bitcoin and other digital currencies is not. Bitcoin can be seen as direct competition. On top of that, bitcoin doesn’t censor… which is something Paypal does. Therefore bitcoin is also an interesting alternative to those who are being blocked by Paypal from using their service.
Also published on Medium.