PayPal’s move into the cryptocurrency space has gone from being more than just rumours after a letter from the payments giant to the European Commission hinted that they are developing capabilities in the crypto space.
PayPal has long been questioned and quizzed on its thoughts about the impending cryptocurrency and digital asset revolution and where one of the original fintech companies will find itself in the years to come. Having first mostly ignored Bitcoin and the likes, it seems they are now on board.
In the letter, PayPal admitted to “continuously monitoring and evaluating global developments in the crypto and blockchain/distributed ledger space,” adding that it favours a “harmonized” regulatory approach that wouldn’t compromise innovation. The letter is a response, and is titled: “PayPal response to the European Commission’s public consultation of 19 December 2019 on building an EU framework for markets in crypto-assets.”
Of course, PayPal has had links to cryptocurrency before now, but it has seemingly really ramped things up in 2020 after it was reported in June that it was considering introducing direct sales of crypto assets and offering users to store their crypto using the company’s in-house digital wallet.
But, PayPal was also one of the founding Libra Association members, Facebook’s cryptocurrency project, and has called this foray into the space as a time to learn more about cryptocurrencies. PayPal also said it left Libra to work on its own crypto solutions.
“Since the project’s inception, PayPal has taken unilateral and tangible steps to further develop its capabilities in this area, and therefore – without questioning the value of the project – took the decision not to participate in the Libra Association and to continue to focus on advancing our existing mission and business priorities to democratize access to financial service,” the letter said.
What could PayPal add?
PayPal, as one of the first and most successful Fintech companies, has a lot of wisdom to impart on a new and emerging payments ecosystem such as cryptocurrency. The interest is there for companies to try and leverage the assets, but PayPal also has the know-how of getting a new payment’s idea off the ground — something Bitcoin has found hard so far.
Libra would have been a perfect crypto for PayPal to get behind and get off the ground, but if they can develop their own solution, and utilize their own payment rails, there could be a big boost for the use of crypto in the payments space.