PayPal was originally created in December 1998 as Confinity by Max Levchin, Peter Thiel, and Luke Nosek. The company initially focused on security software for handheld devices but later pivoted to developing a digital wallet for secure online payments. Later, in 2000, Confinity merged with X.com, an online financial services company founded by Elon Musk, and the combined company eventually became known as PayPal.