PayPal open letter: Why do we choose to embrace Crypto?

Original compilation: Deep Chao TechFlow

Money, payment and freedom

Money is not powerful when it accumulates; money is powerful when it flows.

Billions of transactions occur every day around the world, and payments are the most tangible and frequent use of money. However, payments are more than just an exchange of value; they are a story about progressive freedom.

Every transaction we make—from buying a coffee to moving money overseas—is an expression of our financial autonomy. On the other hand, not being able to pay the way we want limits our ability to build, share and leverage value on our own terms.

PayPal appeared at a key point in the history of payments. From the early days of e-commerce, we have established ourselves as a beacon of trust, giving users the confidence to transact in a powerful but difficult new ecosystem. Now, more than a decade after the advent of blockchain technology, PayPal is once again taking on a new challenge at a critical moment in payments history. Just like we brought payments online, we are now bringing payments on-chain.

Our commitment throughout our term remains the same:Promote payment innovation so everyone can pay how they want.

Digital payments revolution

When it comes to payments, the latest structural shift has come with the Internet.

As vast amounts of information move online, so do the mechanisms for tracking and managing money—from account balances and transaction histories to broader business activities. This booming e-commerce ecosystem sets new expectations for how transactions are conducted.

Demand now evolves as people seek the same immediacy and borderless payments they experience in everyday online communications.

This digital transformation highlights emerging gaps. While the Internet provides the infrastructure for global commerce, there is a distinct lack of trustworthy and efficient online payment systems. People seek a platform that is not only secure, but also fast and intuitive. Businesses need a reliable platform that resonates with a growing online customer base.

PayPal bridges the gap between the new digital financial trajectory and consumers urgent need for trust and accessibility. We have built an ecosystem that enables people to pay how they want by providing them with flexible and secure global payments.

Today, PayPal has more than 40 million active accounts, proving that its success isnt just the result of identifying a gap in the market.

It’s about our unwavering commitment to making payments easier. Over the decades, as the internet has grown and other fintech tools have emerged, our focus has remained unchanged. From our early days facilitating eBay deals to our acquisition of Venmo in 2013, our trajectory has been defined by the answer to one question:How people want to pay？

Weve spent decades trying to answer this question. At the highest level, the answer is still quite simpleShan: People want fast, cheap global payments.Over the past three decades, solutions have still not been the best.

The New Gap: PayPal, Cryptocurrencies, and the New Financial Railroad

While the digital payments space has been striving to provide global, instant and seamless transactions, reality often shows a shortcoming.

To date, payments innovation has been built on the same fundamental financial trajectory as the rise of the internet. In fact, instant settlement and 24/7 service are often a convenience achieved through services that accept (or transfer) risk.

Settlement times for online payments are still long (average 2-3 days in the US). Markets, banks and services maintain operating hours, further extending settlement times. Employers struggle to pay an increasingly distributed workforce. An increasingly globalized population struggles to send money across borders cheaply and quickly. Businesses feel this friction most often, while consumers still face lengthy settlement times in certain payment environments where they believe they should be fast.

Simply put, people today are not necessarily able to pay the way they want.

So why are we turning our attention to Crypto? the answer is:It is practical.

Cryptocurrencies bring us closer to what people want: fast, cheap global payments. And, as we said before, were in the payments business.

Blockchain is the new financial rail—the new payment rail. Blockchain technology disrupts how payments appear and actually work. Settlement time is nearly instantaneous for customers and businesses—no matter the time or place.

This cannot be underestimated, blockchain technology is the only technology that provides a new payment method. While it may seem like a fad to some,For PayPal, blockchain looks like it makes sense.

If there was a payment instrument that could provide round-the-clock, near-instant and cost-effective transactions, then exploring that solution would be a practical option. This is not about jumping on the bandwagon; this is about whether we can identify and adopt an alternative, potentially better financial technology for payments.

Again, PayPal sees itself with an opportunity to bridge the gap between the new payments trajectory and its widespread adoption and trust. We have 40 million accounts and can be better served with additional options for blockchain-based payment solutions. Just as we did in the early days of e-commerce, PayPal is once again working toward a single goal: letting you pay how you want.

PayPal,Payments and PYUSD

In 2020, we allowed PayPal and Venmo users to buy, hold, and sell cryptocurrency in their accounts. Last year, users could start transferring cryptoassets they purchased in their accounts to external wallets, including decentralized wallets.

We envision that PayPal and Venmo will continue to serve as key hubs for commerce, serving as the primary channels through which businesses and individuals transact goods and services. By allowing crypto assets to be transferred between PayPal and Venmo accounts, we are better connecting the DeFi and CeFi worlds with a platform that excels at facilitating payments.

Our broad view on blockchain and cryptocurrencies is neutral – that is, we have no ideological preference in this race.

We know that customers still want easier, faster, and cheaper payments; we know that blockchain enables these types of payments in a way that is not available on today’s Internet finance track; and we believe that customers should choose to adopt new solutions. solutions to meet their potential needs.

However, we do have a subjective stance on stablecoins. We believe they are necessary tools to fully realize cryptocurrency’s capabilities as an accessible and flexible payment instrument. PYUSD issued by Paxos is our stance in the stablecoin space. This is our commitment to our customers. Were doing what weve been doing since 1998: giving our customers what they want.

Our customers want easier payments. Businesses want to pay their suppliers without worrying about settlement time. Individuals want to send money to family members without paying high fees and waiting days. Todays financial infrastructure cannot quickly meet the needs of customers for fast transactions. We do not want customers to lose value while waiting.

Today, blockchain technology is the only innovation that offers a completely new payment rail that helps meet customer needs. We have always strived to be pioneers in one thing: always giving our customers what they want and deserve – trust, confidence and ease. PYUSD is just the next evolution toward that goal.

Pay whatever you want

At PayPal, weve always believed that the essence of money is that it flows, and that fast, cheap, and globally mobile money is what our customers are looking for. PayPals history is the story of this unwavering commitment: enabling people and businesses to transact on their own terms. We believe that cryptocurrencies create a new paradigm that can help achieve payment goals around the world.

In other words, we think its simple:Paying with cryptocurrency means paying what you want.