Jose Fernandez da Ponte, a PayPal executive, announced at the Consensus 2021 conference that the company was actively working on the development of a cryptocurrency withdrawal feature.
The General Manager for PayPal’s Blockchain, Crypto, and Digital Currencies division referred to the future feature by stating:
“We want to make it as open as possible, and we want to give choice to our consumers, something that will let them pay in any way they want to pay. They want to bring their crypto to us so they can use it in commerce, and we want them to be able to take the crypto they acquired with us and take it to the destination of their choice.”
The feature would be a long-waited addition to the PayPal ecosystem, which adopted crypto back in 2020 by allowing its United States Costumers to acquire and sell cryptocurrency via the platform. This support was later on extended to allow users to pay using their cryptocurrency balance upon checkout.
While PayPal’s endorsement of crypto was well received by most cryptocurrency advocates, some critics were quick to point out that the features were lacking functionality to be consistent with crypto’s ethos, as the platform forced users to keep the cryptocurrency use limited to the PayPal ecosystem.
Crypto Is Becoming an Essential Component of PayPal
PayPal’s interest in cryptocurrency has been increasing over the months, with the company’s CEO telling Time Magazine back in April that, “Demand on the crypto side has been multiple-fold to what we initially expected. There’s a lot of excitement.”
“Demand on the crypto side has been multiple-fold to what we initially expected,” says Paypal CEO Dan Schulman. “There’s a lot of excitement”https://t.co/hLi7YcecCi
— TIME (@TIME) April 27, 2021
In the Interview, Dan Schulman also said that the company’s interest in cryptocurrency and Distributed Ledger Technology (DLT) has been brewing for about six years, but executives had considered that crypto was lacking when it came to acting as a currency, citing its volatility.
The addition of crypto futures is a reflection of the company believes in the future of crypto, as Schulman believes that the next decade will bring, “a tremendous decline in the use of cash” and “Credit cards as a form factor will go away,” something he believes will mark the, “advent of digital currencies.”
While digital currencies also refer to Central Bank Digital Currencies (CBDCs) being developed by governments around the world, he believes that CBDCs won’t take the spotlight away from crypto but will coexist with them.
PayPalCoin is Not Here Yet
Rumors about the possibility of a PayPal stablecoin gained popularity in early May, resulting from an exclusive report by “The Block” which gave prominence to the rumor. According to the website, four sources shared that the company had been holding exploratory talks around the topic of stablecoin development.
While the company did not confirm the rumors at the time, a spokesperson referred to the rumors by stating:
“As a global company working with regulators and industry partners throughout the world to shape the next generation of financial systems, the company is in frequent conversation about technologies that enable these goals. However, rumors and speculation are not predictive of the company’s future plans.”
Despite the statement, rumpus continued to circulate the crypto space, which prompted the moderator at the Consensus 2021 conference to ask Schulman about the possible launch of a PayPal stablecoin, with PayPal CEO replying that “This is way too early”.
The launch of a stablecoin by a company with the influence and userbase of PayPal could further increase interest in cryptocurrency by users who might not be familiar with it, as PayPal is one of the most recognized and used digital payment solutions in the world.
The use of cryptos in PayPal’s multitude of platforms may create more demand for digital assets going forward.