PayPal preference for Crypto

PayPal is a well-known brand and one whose crypto trajectory, unlike Tesla’s, appears to be unstoppable. Not only has the company made crypto a funding source for 26 million merchants, but it has also spent $200 million acquiring BitGo rival Curv, whose clients include eToro and BNP Paribas.

PayPal has been signaling a support for bitcoin for several months. In October 2020, the company announced that it was planning to offer increasing support for crypto assets to roll out gradually, with PayPal CEO claiming that it is “eager to work with central banks and regulators around the world” to support the movement. The first installment of this plan materialized for regular customers in November, when PayPal took on many of the functions of both a wallet and an exchange.

In essence, this new update allowed users to hold crypto assets, such as bitcoin, ether and others, on a wallet integrated directly into their PayPal account. In addition to allowing crypto from other wallets to enter this one, it also allowed for the direct purchase of these assets with fiat currency from the reserves that PayPal itself owned. It is this two-pronged approach that laid the foundations for PayPal’s newest development, though it did not enable bitcoin holders to claim full custody of their own BTC. 

On March 30, 2021, the company announced that the next phase of its bitcoin support rollout was forthcoming: an option to pay with cryptocurrency instead of a card or other payment method at vendor checkout. Now, naturally, PayPal itself does not have the power to compel every single merchant that uses its services to accept bitcoin as legal tender. However, thanks to its hosting and exchanging capabilities, PayPal is acting as an invisible middleman in these transactions. 

PayPal’s CTO, believes that the technology transition toward blockchain and cryptocurrencies will assist in democratizing financial services and improve financial inclusion. PayPal, which Elon Musk co-founded, is a trusted, recognizable business that might serve as a portal to the world of digital assets for consumers.

Skrill is a digital wallet provider established in 2001 which offers a range of online payment and money transfer services. Since launch, Skrill has expanded to operate in more than 120 countries with the digital wallet offered in 40 different currencies .Skrill,the money transfer business that recently expanded its crypto offering to the United States thanks to a collaboration with Coinbase, may be argued to be in a similar boat.

Last year, Moneybookers, a company with 40 million active users in over 200 countries, launched its prepaid card and a remittance solution, and a loyalty program. It, like PayPal, is assisting in the mainstreaming of cryptocurrency. Skrill and PayPal have been around for a while, but the next era of payments is bringing in new companies. Platforms such as Public Mint, a so-called “fiat-native blockchain” that claims to make payment settlement more effortless and more accessible. They are allowing users to transact in dollars via a synthetic asset (USD+) whose underlying currency is retained by custodians, with network fees paid in fiat.

With its future Earn program, Public Mint wants to introduce direct fiat liquidity to the worlds of CeFi (centralized finance) and Defi (decentralized finance). The platform is compatible with different blockchains like Ethereum and Polkadot. The concept aims to provide banks with better interest rates while avoiding the absurd APYs of existing high-risk liquidity mining.