PayPal plans to rapidly expand its cryptocurrency services in 2021 and support central bank digital currencies (CBDCs) when they finally roll out
PayPal announced its entry into the cryptocurrency space last month, with the payment processor initially offering its services to its US customers. However, the company intends to expand rapidly internationally in the first half of 2021.
Dan Schulman, CEO of PayPal, and other senior executives made this clear in the company’s earnings report for the third quarter of 2020. Schulman told investors that the world is moving rapidly from physical to digital, highlighting the speed of change in the payments and financial services sectors. The rapid change in the payment and financial services industry is why PayPal offered its cryptocurrency services to Venmo and international customers in the first half of 2021. Schulman stated, “Over the next year we will become a couple from different fields”.
Currently, only 10% of customers in the US can access the cryptocurrency services, while the remaining customers in the country will use the service for the next two to three weeks. Following the cryptocurrency announcement, PayPal saw enough interest to justify the company increasing its weekly crypto purchase limits from $ 10,000 to $ 15,000.
Schulman predicted massive opportunities for PayPal in economies that support digital identity, fully digital payments, and financial services.
PayPal to support CBDCs
Central bank digital currencies have been the rave in finance for the past few months. Currently, no digital currency has officially been released for commercial use in any part of the world. However, some countries like China, Uruguay and others are making massive strides in this sector with the development of their CBDCs. Other countries like Canada, Australia, the European Union (EU), and many others continue to explore the possibilities of introducing CBDCs.
PayPal’s CEO believes that the central bank’s digital currencies will soon be entering the digital economy. Right now it’s a matter of when, not the case. When CBDCs are released for widespread adoption, PayPal will be ready to endorse them.
The payment processor aims to create the world’s most comprehensive and compelling digital wallet that also supports CBDCs. The CEO added that PayPal’s size and notoriety could help shape the usefulness of the central bank’s digital currencies.
Schulman believes that the old financial system no longer works for ordinary people. Therefore, a change in the financial landscape is required. He believes PayPal and its digital infrastructure can help make the management and movement of money faster, cheaper, and more efficient.