In an interview with Time magazine, Dan Schulman, CEO of PayPal, talked about the expansion of the payment business into the encryption field. He believes that e-commerce will be transformed into a personalized experience and “relevant” purchases driven by social media platforms. Bitcoin can Extend this change to the entire financial system.
Schulman believes that 2020 is a critical year, which has accelerated the trend of digital payment implementation and shortened it by three to five years.
Due to the impact of the epidemic, more and more people have decided to use PayPal or similar platforms for daily purchases.
According to data shared by Schulman, users made 15.4 billion payments through PayPal last year, with an estimated value of US$936 billion. This trend may increase further in 2021 to meet the needs of PayPal’s approximately 300 million users.
In the next 10 years, the CEO of PayPal believes that cash as a payment method may become less and less, which will affect credit cards and commonly used forms of payment such as checks and wire transfers. Schulman said that digital payments can “add more value.”
In predicting the benefits of Bitcoin and cryptocurrencies, Schulman pointed out, “So when all these things start to happen, then the central bank also needs to reconsider monetary policy, because when people no longer use paper money, they just issue more to the system. Paper money is meaningless, which led to the emergence of digital currency.”
Schulman believes that the traditional financial system is “inefficient” and calls for a more “modern” approach to make it more inclusive and cost-effective.
Generally speaking, transactions in the traditional financial system can charge an average fee of 2.8%. Therefore, many candidates conduct transactions outside of this.
Schulman said: “You may have predicted the deceleration of industry size and technological progress, but the 2.8% transaction fee causes the worst thing to be that if you have less income or are outside the economic system, and you are not rich, then this The ratio is equivalent to 1,000 basis points instead of 280 basis points.
So is there a way for you to do things more efficiently in a lower cost, more inclusive way, and add more utility to the system? “
Central bank digital currency (CBDC) can be a tool to achieve this goal. For example, the USD CBDC allows the government to use PayPal’s platform to “open up Fed funds” so that monetary assistance can be sent directly to citizens’ digital wallets, and taxes can be paid through a simpler mechanism.
PayPal’s cryptocurrency service has been under scrutiny since 2014 and was only recently launched. Schulman previously believed that cryptocurrencies are too volatile and lack civic awareness, but now the timing seems perfect.
In 10 years, PayPal and Bitcoin can be integrated with one of the “6 to 10 super apps”, and they will act as a bridge between people and other apps. Users have more control over their data and the way they interact with products or services.
Regarding the demand for Bitcoin and other cryptocurrencies, Schulman believes that “the demand for cryptocurrencies has doubled than we initially expected. There are many exciting things.”
As of the end of March 2021, the company’s payment business provides its users in the United States with a cryptocurrency checkout function. PayPal is likely to expand its services to international customers this year. Due to the requirements of the Bitcoin license granted by the State of New York, the company must hold a 1:1 ratio of BTC, ETH, and LTC to users.
Therefore, PayPal’s increased demand for Bitcoin and other cryptocurrencies has brought direct buying pressure to the market. Bitcoin trading has a daily profit of 8.7%, at $53,950. In the weekly and monthly data, there are still 3.6% and 1.4% losses.
Author/ Translator: Jamie Kim
Bio: Jamie Kim is a technology journalist. Raised in Hong Kong and always vocal at heart. She aims to share her expertise with the readers at blockreview.net. Kim is a Bitcoin maximalist who believes with unwavering conviction that Bitcoin is the only cryptocurrency – in fact, currency – worth caring about.