PayPal, the fintech giant planning to bring crypto trading to its massive user base, has chosen Paxos to handle the new service’s supply of digital assets, according to two people familiar with the matter.
It’s a plum assignment for New York-based Paxos, which last week launched Paxos Crypto Brokerage and announced its first customer in Revolut US, the American division of the U.K.-based fintech firm that offers bitcoin trading. A formal announcement of the PayPal relationship could come as soon as this week, one source said.
The offering would make PayPal one of the most prominent mainstream companies to offer cryptocurrency purchases, joining fellow publicly-traded payments provider Square and unicorn stock brokerage Robinhood.
It is not clear exactly which cryptocurrencies PayPal intends to offer. Paxos declined to comment for this story. PayPal did not return requests for comment by press time. CoinDesk broke the news of PayPal’s crypto plans on June 22.
CoinDesk reported then that PayPal and its Venmo subsidiary would be bringing direct buying and selling of crypto to some portion of the company’s 325 million users.
The new Paxos brokerage, an API-based solution for making crypto services easy for businesses to roll out, allows cryptocurrency buying, selling, holding and sending capabilities – while handling all regulatory compliance aspects. Paxos, which holds a New York state trust charter, is a qualified custodian, legally permitted to hold gold and digital assets such as bitcoin (BTC) and ether (ETH) on institutional investors’ behalf.
San Francisco-based cryptocurrency exchange Coinbase, which has a longstanding relationship with PayPal, was said to be in line to provide some kind of white-labeled crypto offering. European exchange Bitstamp (which provides crypto liquidity to Revolut in the U.K.) was also mentioned as a contender at the time. Both companies declined to comment for this story.