PayPal Makes Its First-Ever Investment in a Blockchain Startup

Online payments giant PayPal has made its first-ever investment in a blockchain technology company.

Announced today, PayPal has joined the extension of a Series A funding round in Cambridge Blockchain, a startup that helps financial institutions and other companies manage sensitive data using shared ledgers.

Neither PayPal nor Cambridge Blockchain disclosed the investment amount, but recent filings with the SEC indicate that Cambridge Blockchain has raised a total of $3.5 million in new equity from several investors over the past nine months.

The subsequent $3.5 million came from PayPal as well as Omidyar Network, the philanthropic investment firm started by the founder of eBay; Flourish, Omidyar's financial inclusion investment spinoff; and Future/Perfect Ventures.

"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."

She confirmed that Cambridge is PayPal's first investment in a blockchain company.

Cambridge Blockchain CEO Matthew Commons said PayPal has been involved one way or another with his Massachussets-based identity startup for the past year or so.

Serendipitously, Cambridge Blockchain has been working with LuxTrust, which is backed by the government of Luxembourg and financial institutions in the region.

Stepping back, Massachusetts-based Cambridge Blockchain stores, shares and validates data using blockchains, and in this capacity, it can run on top of any flavor of distributed ledger, public or private.

The startup is part of the Decentralized Identity Foundation which counts the Enterprise Ethereum Alliance, R3, IBM Blockchain, and Hyperledger among its members.