CyActive, which to date has only raised $2 million, was founded in 2013 by CEO Liran Tancman and CTO Shlomi Boutnaru, to develop software that predicts and prevents future malware by analyzing past attacks.
This is only the second Israeli acquisition by PaPal.
Experts say CyActive is one of a very small number of cyber security programs available today which are completely fail-safe in actually preventing cyber threats, not merely recognize and fight them.
Tzruya said the program can detect whether an attack against another company could be tweaked to breach the system it is protecting, and takes steps to prevent the new attack before it arrives.
Tzruya suggested that in the Sony event, the attack was a variant of several other attacks, which CyActive would have spotted and blocked.
PayPal made its first Israeli acquisition in 2008, buying FraudScience for $169 million. The PayPal fraud control center is now in Tel Aviv.