- PayPal CEO Dan Schulman has in an interview revealed that his company has witnessed cryptocurrency demand beyond the initial expectations.
- He has also shared his views of what the financial infrastructure will look like in 5 to 10 years, a period in which he expects more changes in the financial system than witnessed over the past 10 to 20 years.
The President and CEO of PayPal, Dan Schulman, has been discussing cryptocurrencies and his company’s role in their recent build-up. In an interview with TIME, the CEO talked about how it “was pretty cool” purchasing boots on his own platform and paying in Bitcoin. This was realized because PayPal recently launched a crypto checkout service for US consumers. Users can buy, hold and pay using Bitcoin, Ether, Bitcoin Cash and Litecoin for merchandise. At the time, Schulman celebrated the move stating that this would be the first time where using cryptocurrencies would be as seamless as using a credit card or debit card on the PayPal wallet.
In the recent interview, the CEO has disclosed that the demand on the crypto side is multiple-fold to what the company initially expected. Furthermore, he explained why PayPal took long to adopt them,
We’ve been looking at digital forms of currency and DLT for six years or so. But I thought it was early, and I thought the cryptocurrencies at the time were much more assets than they were currency.
As an asset, cryptocurrencies are prone to price fluctuations discouraging businesses to accept. He added that there were concerns about regulations as digital currencies were still not mainstream. However, in recent months, this has been the case, compelling the governments to formulate regulations.
While PayPal only launched crypto payments last month, the CEO has confirmed that the shift to digital payments was greatly influenced by the outbreak of COVID-19. The lockdowns and a campaign discouraging physical contact spurred online payments. Paypal is reported to have processed 15.4 billion payments, with a value of $936 billion last year.
Schulman: Financial infrastructure needs modernization
Like most fintech executives, Schulman holds the view that the current financial system is outdated. In the interview, he stated that in the next five to ten years, all forms of payments will collapse into the mobile phone. Venmo, a mobile payment system owned by PayPal has only last week adopted cryptocurrencies. The platform announced it will let its more than 70 million users spend as little as $1 to buy Bitcoin, Ether, Litecoin and Bitcoin Cash. Users can also hold or sell using the platform.
The general manager of Venmo, Darrell Esch, stated that Venmo was seeking to be a trusted platform where users can learn and engage with cryptocurrencies. The current financial infrastructure has been slow, inefficient and expensive. One of the ways modern economies plan to upgrade their systems is through Central Bank Digital Currencies (CBDCs).
Central bank-issued digital currencies can also take advantage of distributed ledger technology [DLT] or other modern technologies, but they’re basically digitizing a fiat currency like the U.S. dollar.
The PayPal CEO believes that if the US introduced a digital dollar, it would allow for the Fed to not only fund banks but other institutions such as PayPal. Admittedly the US is lagging behind with other countries already testing, issuing, or in the final stage of development of the same.
PayPal looks into Ethereum, Polkadot, Solana, and Algorand to scale its payments technology
- PayPal is keeping track of Ethereum, Polkadot, Solana, and Algorand for the blockchain that can best scale its payments technology.
- The firm also wants to support NFTs due to user demand but cites technical difficulties in buying these collectibles.
Online payments platform PayPal is now actively monitoring layer-one and layer-two platforms that deal with scaling payments. These include Ethereum, Polkadot, Solana, and Algorand. The payment provider is looking at how these networks and their currencies can fit into its plans for a scalable payments infrastructure.
In October last year, PayPal enabled buying, selling, and holding of four cryptocurrencies on the platform. These are Bitcoin, Ethereum, Litecoin, and Bitcoin Cash. In its latest Q3 earnings report, the firm promised to increase its future crypto offerings, and this seems to be where it is now headed. The stellar performance of cryptocurrencies has caused many payment channels to open their doors for cryptocurrencies. Among them are Visa, Mastercard, and now PayPal.
Speaking in a recent podcast. PayPal’s senior vice president and general manager of blockchain, crypto, and digital currencies, Jose Fernandez said the company’s decision to offer crypto services was fueled by several occurrences. One of them is the massive demand from consumers and merchants to use cryptocurrencies as a payment instrument. Another is the regulatory stance declaring the legality of the crypto industry. Fernandez said;
We thought that it was part of our responsibility to help in making this asset class more accessible to the public,
PayPal and cryptocurrencies
Talk in the crypto community has it that PayPal has plans to release its stablecoin. However, the company’s exec denied the rumors, saying the firm had yet to evolve to such proportions. He added that most stablecoins available are useful in trading or the decentralized finance (DeFi) sector. But while these are commendable use cases, PayPal is yet to find a stablecoin “that is purpose-built for payments.”
Instead, the payments firm is hoping to leverage blockchains that support scalable payments.
“I’m sure that if you ask me six weeks from now I could give you four or five different names. This is how exciting it is,” Fernandez remarked of the blockchain networks.
And other than digital assets and blockchains, PayPal has displayed interest in non-fungible tokens (NFTs). This is fueled by demand from the firm’s merchants and partners, especially those in the media industry.
Based on the analytics platform DappRadar, the NFT trading volume in Q3, 2021 was $10.67 billion. This represents a 704 percent increase from the previous quarter. Fernandez thinks there is “a role for us in NFTs.” However, technical complications in buying and holding NFTs discourage many from interacting with the sector.
The experience of buying an NFT today is the number of hoops that you need to go through.
This does not favor the “early adopter” or the “curious but not sophisticated user,” he adds.
PayPal co-founder suggests he’s underinvested in Bitcoin while it records new ATH
Bitcoin [BTC] did it once again. The asset broke its own record and caught the attention of the entire globe. Amidst this, PayPal’s co-founder, Peter Thiel expressed his angst over being “underinvested” in the world’s largest cryptocurrency.
The crypto industry as a whole garnered immense popularity over the last couple of years. From being closely regarded as an instrument that carries out illicit activities, to being adopted by governments across the globe, Bitcoin has certainly come a long way. Now, with a market cap of $1.2 trillion, Bitcoin stands as one of the most prominent currencies in the world.
Earlier today, BTC pushed past its previous all-time high of $64,899 and managed to hit a new high of $66,930.39. While BTC HODLers rejoiced this surge, an array of people were rather disappointed that they hadn’t poured in their money into the king coin. One of them was PayPal’s co-founder Peter Thiel.
PayPal’s co-founder talks crypto
During a recent interview, PayPal’s Thiel revealed why he felt underinvested in the asset. He added,
“You’re supposed to just buy Bitcoin. I feel like I’ve been underinvested in it.”
The latest move of Bitcoin was lauded by the entire market. Speaking about the effects of BTC’s ongoing rally, the PayPal co-founder suggested that “we are at a complete bankruptcy moment for the central banks.”
An array of people took to Twitter and made their own predictions about Bitcoin. While some suggested that BTC was slated to endure a major fall, a few others noted that the coin could be aiming for $70K. Tesla’s Elon Musk had a rather bizarre prediction for the coin.
The Tesla CEO’s latest tweet read,
Bitcoin’s rally certainly paved the way for several altcoins hitting new highs. Ethereum PETH], the second-largest cryptocurrency followed the footsteps of BTC and managed to hit an all-time high of $4,366.
PayPal has played a major role in the crypto-verse in the last year. From opening doors to crypto and constantly remaining bullish about it, has pushed several assets to a new level.
PayPal Launches New Digital Payments App With Crypto Capabilities
Financial giant PayPal just announced the launch of a new financial application that will make crypto services even more accessible on its platform.
PayPal is sharing details about the first iteration of its digital wallet and payments app, which features an array of new financial capabilities.
As the announcement explains,
“The new app includes a personalized dashboard of a customer’s PayPal account, a wallet tab to manage payment instruments and direct deposit, a finance tab that includes access to high-yield savings and crypto capabilities, and a payments hub that includes send and receive money features, international remittances, charitable and non-profit giving, bill pay, and a two-way messaging feature to send notes of acknowledgment after peer-to-peer transactions.”
The payments giant will partner with Synchrony Bank to create a high-yield savings account called PayPal Savings. The service is expected to start rolling out to US-based customers in the coming months.
Dan Schulman, president and CEO of PayPal, says that the new app simplifies the customer experience by creating an all-in-one service that eliminates the need for multiple financial applications.
“Our new app offers customers a simplified, secure, and personalized experience that builds on our platform of trust and security. [It] removes the complexity of having to manage multiple financial or shopping apps, remember different passwords, and track loyalty rewards.”
PayPal also plans to add new features and enhancements to the app in the future. The company intends to offer investment capabilities and payment options with the app online and in-store, including offline QR code payments and enhanced PayPal-branded capabilities to offer new ways to shop and save in-store.
According to the press release, PayPal expects the number of digital wallet users to grow vastly over the next few years, with 48% of consumers citing simplicity as the main reason for adopting digital wallets.
“The number of consumers using digital wallets is expected to double to 4.4 billion globally by 2025, and nearly half of consumers (48%) already cite simplicity as the top reason to use a digital wallet.
The new PayPal app aims to address this [need] by offering an all-in-one app as the primary destination for customers to easily manage their day-to-day financial lives.”