Revolut bank offers cryptocurrency through Paxos ‘plug and play’ service

July 15, 2020, 10:00 AM UTC

A handful of well-known companies, including Robinhood and Square, already offer Bitcoin and other cryptocurrencies. Now, a crypto startup wants to make it easier for hundreds of other companies to do the same.

On Wednesday, New York-based Paxos announced a new brokerage service that is intended to let merchants offload the technological and regulatory challenges that go with cryptocurrency.

Paxos’s first client is Revolut US, the American division of the online bank that is popular in the UK.

In an interview with Fortune, Paxos CEO Chad Cascarilla likened the new brokerage to a “plug-and-play” service by which companies of all sorts—from retailers to payment firms—can offer crypto to their customers while relying on Paxos on the backend.

“It’s clear many firms want to offer crypto, but are finding it’s difficult to build the regulatory and technological infrastructure to do that,” he says. “This allows anyone, no matter what type of firm they are, to do that.”

Paxos points to the tie-up between Starbucks and Bakkt, the Bitcoin subsidiary of the New York Stock Exchange, as an example of the growing interest among non-financial firms towards crypto.

While Paxos is a relatively minor player in the cryptocurrency world, the company stands out in part because it is a regulated trust company. This legal structure obliges it to retain 100 percent of the assets it holds on customers’ behalf—unlike banks, which can loan out customer deposits.

The trust structure also allows Paxos to enter deals with traditional financial firms inclined to avoid cryptocurrency for reason of risk or regulation.

Paxos already offers a cryptocurrency token backed by physical gold, and plans to use its new brokerage platform to offer a plug-and-play service for a variety of other assets.

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