Odaily Frontline | Details of PayPal's encryption plan disclosed: a dedicated business unit will be established
This article comes fromDecrypt & The BlockOdaily Translator | Nian Yin Si Tang
Odaily Translator | Nian Yin Si Tang
Summary:
Summary:
- PayPal CEO Daniel Schulman on the company's crypto plans;
- These plans include investing in the establishment of a business unit dedicated to encryption services;
- Later this year, PayPal will allow users to make purchases with cryptocurrencies.
On Feb. 4, PayPal released new details about its cryptocurrency plans.
PayPal CEO Daniel Schulman said on the 2020 Q4 earnings call that the plans include creating a new division focused on encryption.
He said: "We all know that the current financial system is outdated, and we can foresee a future where transactions will be completed in seconds, not days; It’s just the wealthy who are becoming part of the digital economy. We are investing heavily in new cryptocurrency, blockchain and digital currency business units to help shape a more financially inclusive future.”
PayPal's business unit plans to "go all in" such services, one of the people said.
Schulman also said, “PayPal is excited to build on this early success by allowing customers to use their crypto balance as a source of funds when shopping at 29 million merchants.”
"We expect this functionality to begin rolling out later this quarter, with the hope of rolling out the first international markets in the coming months." He went on to explain that Venmo's integration with cryptocurrencies is expected to happen "in the coming months." conduct.
Schulman described the moves as "the start of a broad roadmap around crypto, blockchain and digital currencies."
Additionally, in an investor update, the company wrote: “Customers who have purchased cryptocurrency on PayPal are now logging in twice as often.”
Although Schulman did not disclose specific earnings, he said: "The volume of cryptocurrency transactions on the platform has greatly exceeded our expectations."
Overall, PayPal’s payments totaled $277 billion on revenue of $6.1 billion in the fourth quarter of 2020, its strongest quarter to date, though figures for cryptocurrencies are calculated separately.
PayPal formally launched its encryption service last October in a partnership with industry startup Paxos. The service went live a few days after the announcement and opened to eligible U.S. users on November 12. The service allows users to buy, sell and hold cryptocurrencies directly from their PayPal accounts, and allows users to use cryptocurrencies to settle purchases at 29 million merchants on the platform. Users can currently purchase four cryptocurrencies, BTC, ETH, BCH, and LTC, on the PayPal platform.
The payments giant expressed optimism at the time, with Schulman noting at the time: "This is just the beginning of the opportunity we see, and we will work hand in hand with regulators to accept new forms of digital currency." Currencies gain momentum in the future, and PayPal may one day integrate them.
So far, the payment network has only facilitated the buying, holding and selling of these cryptocurrencies. Later this year, the company plans to allow users to use the cryptocurrency in their PayPal accounts to shop at 29 million merchants. But even without the feature, cryptocurrency integration has paid off for PayPal, as the company already pockets a percentage of every cryptocurrency transaction made through the platform.
As retail demand for cryptocurrencies continues to grow, this revenue is bound to come in handy. The entry of PayPal, along with institutional investment from MicroStrategy, Square, and others, helped propel Bitcoin’s price up and a lot of attention among ordinary people.
Since PayPal made the announcement on October 21 last year, BTC has tripled from $12,221 to over $37,000. ETH has quadrupled during the same period, from less than $400 to over $1,600; BCH has soared from $260 to $440; LTC has also quietly risen from $50 to more than $150.
That aside, PayPal stock closed at $249 yesterday. On Oct. 20, the day before the crypto integration was announced, the company closed at $202.
Today's earnings call is the first opportunity for investors and the public to hear real numbers about PayPal's cryptocurrency offering, though details are scant.
