In October, rumors swirled that PayPal was poised to acquire BitGo, one of the country’s oldest cryptocurrency firms. That deal will not happen, according to multiple sources, and BitGo is now charting a new path.
In a recent interview with Fortune, BitGo CEO Mike Belshe noted that his company now holds over $16 billion worth of cryptocurrency assets for its customers and that it’s acquiring several significant clients every week.
While BitGo has been around since 2013, it has a lower profile than firms like Coinbase and Kraken, which offer exchanges for anyone to buy and sell Bitcoin and other cryptocurrencies. BitGo’s core offering is instead a custody service that securely stores crypto on behalf of institutions and other wealthy clients.
In the past year, BitGo has aggressively sought to redefine itself as a full-service crypto shop that offers other tax and lending services, as well as a means for clients to discreetly arrange large trades.
Belshe notes BitGo is among many companies that has benefited from the current Bitcoin bull market. But he says the crypto industry faces challenges in building infrastructure—including security—as large companies like PayPal and Square move into the field.
Belshe adds that the biggest crypto custodians, which also include Fidelity and Coinbase, will play a key role in working to ensure crypto continues to gain a foothold in mainstream finance.
As for the PayPal rumors, Belshe wouldn’t confirm them, but he said BitGo has been “in talks with everyone” over the years and that the privately held company won’t accept a “small exit.”
PayPal declined to comment on acquisitions talks. But a person close to the payment giant confirmed the BitGo talks had fallen through, adding that PayPal is exploring other potential acquisitions.
According to Belshe, BitGo is not currently profitable, as it is in “growth mode,” but that it has a “very healthy balance sheet” and has no plans to raise capital in the near future.