Is bitcoin (BTC) included in PayPal’s proposed ‘digital wallet’ with ‘multiple types of currency’?
In the past several weeks, reports have surfaced that indicate that the two companies view bitcoin platforms as potential competitors. According to one report released earlier this month, eBay thinks the digital currency is a threat to PayPal.
In addition, the web auction firm thinks providers of digital wallets, payment card processors, Amazon payments, providers of mobile payment services, card readers for mobile devices and omni-channel POS (point of sale) solutions are threats as well as significant challengers to the company’s business model.
One day after that report made the rounds, Entrepreneur magazine discovered that PayPal began to crack down on users who utilized its platform to sell bitcoin. Various users confirmed what had been transpiring to bitcoiners.
“Paypal has largely ignored and allowed physical Bitcoin sales until beginning of this year when some kind of new policy triggered a massive account review on everything Bitcoin-related that’s considered high value sales, including physical coins,” newguy05 wrote.
In the near future, will eBay be changing its viewpoint on virtual currencies? The bitcoin community has been intrigued since Tuesday when eBay CEO John Donahoe discussed the matter of digital currencies on the Bloomberg News program “Street Smart.”
Donahoe was engulfed with questions regarding the growing influence of bitcoin and the possible competition that virtual currencies can pose against payment services, like PayPal. He confirmed that PayPal is “pursuing digital payments and is the leading digital payments alternatives in many different environments.”
Matt Miller, the program’s co-host, retorted that once most consumers use bitcoin then there will be no use for PayPal anymore.
Donahoe’s response here is what generated buzz: “Well, you can use digital currencies in the PayPal digital wallet, that’s in fact what PayPal is doing — is building a digital wallet that can take multiple types of currency.”
The television program hosts did not follow up on the revelation.
Is PayPal on the verge of adopting bitcoin and other cryptocurrencies? Only time will tell, but it could very well transform the Internet, electronic payment systems and ecommerce transactions. It has been noted that both Donahoe and PayPal CEO David Marcus view bitcoin as maintaining an active role in the ecommerce business.
Many avid bitcoiners see bitcoin not only as a threat to the likes of Visa and PayPal, but also the United States dollar. Although it is pretty much unlikely that bitcoin will destroy the greenback – as former Texas Republican Congressman and three-time presidential candidate Ron Paul alluded to last month – it could revolutionize the way we buy and pay for goods and services on the Internet.
The giants don’t seem to be phased, though.
Speaking on a conference call at the end of January, Visa CEO Charlie Scharf essentially stated that bitcoin is an interesting concept but the company isn’t concerned about its emerging power.
“The established network rules we have, the understanding of how things operate, understanding who the participants are, the fact that the business that we do has financial institutions on either side of the transaction,” said Scharf.
Perhaps once bitcoin exchanges become more secure and developers near guarantee a safer and more secure bitcoin community then it’s possible that cryptocurrencies will merge with PayPal and others like it.
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