Bessie Liu

<div id="highlights-block_62a3a956a4c8e" class="highlights">
 <ul>
 <li>Regulation will be critical for cryptocurrency adoption, PayPal CEO says</li>
 <li>Underserved communities are most likely to benefit from the development of blockchain technology</li>
 </ul>
 
</div>



The future of our financial system is being redesigned in front of our eyes, PayPal CEO Dan Schulman said at CoinDesk&#8217;s Consensus 2022. Rethinking the underlying rails of the existing financial system by taking out intermediaries, so that money can be moved faster and cheaper, has the potential to provide a more inclusive future.



The multinational online payments platform <a href="https://cms.blockworks.co/paypal-enables-crypto-transfers-to-external-wallets-exchanges/" target="_blank" rel="noreferrer noopener">recently enabled</a> its customers to transfer cryptocurrencies from its app to external wallets and exchanges. 



“We built a bridge between the fiat universe and the crypto universe,” said Jose Fernandez da Ponte, the company’s general manager for blockchain, crypto and digital currencies. Consumers will now have access to the wider Web3 network through their PayPal wallets, Fernandez da Ponte said at the conference.



<h3 class="wp-block-heading">Addressing the volatility of cryptocurrencies</h3>



Cryptocurrency is more volatile than many mainstream markets, and consequently, some fund managers have <a href="https://www.cnbc.com/2022/02/14/most-investment-execs-dont-think-clients-should-own-crypto-survey.html#:~:text=68%25%20of%20investment%20execs%20don,should%20own%20crypto%2C%20survey%20finds&amp;text=Sixty%2Deight%20percent%20of%20%22fund,a%20Natixis%20Investment%20Managers%20survey." target="_blank" rel="noreferrer noopener">urged consumers</a> to not invest in cryptocurrencies. 



Schulman says the key to managing market volatility is to have regulators protecting consumers. “Doing responsible innovation with the blessing of regulators is extremely important,” Schulman said. “You may not want it to be that way, but it has to be that way in order to evolve.”



Many people who sit outside the existing financial system or are underserved by the financial system are likely to benefit from money being moved on blockchain rails, Schulman said. Although Schulman believes that PayPal is not yet serving these communities, he is optimistic that it will.



<blockquote class="wp-block-quote">“We are playing the long game, but you’re going to start seeing some significant changes over the next five years.”</blockquote>



Fernandez da Ponte says he is most excited about three things in the coming years: NFTs, stablecoins and digital identity.



As NFTs (non-fungible tokens) move to become a digital property right, they will gain a significant number of use cases, Fernandez da Ponte said. “Now I have a way to prove that I own something on-chain, that is a very significant development that we will see in the future.”



In the case of stablecoins, he believes merchants desiring large-scale sales operations must be willing to use digital currency — stablecoins could provide reliability for these future transactions. “I think we are close to having stablecoins at scale.”



Finally, digital identity will be critical to “prove who you are.” Despite the “really great work being done by the community, that one is probably a little bit further out,” Fernandez da Ponte said.



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PayPal Exec Excited About NFTs, Stablecoins and Digital Identity

Shalini Nagarajan

<div id="highlights-block_62a075457a2ad" class="highlights">
 <ul>
 <li>Select US users can transfer bitcoin, ethereum, bitcoin cash and litecoin to other wallets and exchanges</li>
 <li>Sending crypto outside of PayPal carries a fee determined by network congestion</li>
 </ul>
 
</div>



PayPal users can now transfer cryptocurrencies including bitcoin and ether to third-party wallets and exchanges, nearly two years after the payments giant opened up its platform to digital assets, the company announced on Tuesday.



Currently available to select US users, the feature will be extended to eligible US customers in the coming weeks, according to the <a href="https://newsroom.paypal-corp.com/2022-06-07-PayPal-Users-Can-Now-Transfer-Send-and-Receive-Bitcoin-Ethereum-Bitcoin-Cash-and-Litecoin" target="_blank" rel="noreferrer noopener">announcement</a>.



The San Jose, California-based company first began allowing customers to <a href="https://newsroom.paypal-corp.com/2020-10-21-PayPal-Launches-New-Service-Enabling-Users-to-Buy-Hold-and-Sell-Cryptocurrency" target="_blank" rel="noreferrer noopener">buy, hold and sell</a> bitcoin, ether, bitcoin cash and litecoin in October 2020. But they had no option to move out their holdings from the platform to crypto wallets such as MetaMask and Electrum, or exchanges such as Coinbase.



This feature was one of the most requested updates since the purchase of cryptocurrencies were allowed, PayPal said, and executives had been discussing its implementation for a year.



Now users will be able to move their cryptocurrency from PayPal to other crypto addresses, including hardware wallets — and send crypto to family and friends for free within the same payments network. Sending cryptocurrency outside of PayPal carries a fee, which may fluctuate depending on network congestion.


<div class="wp-block-image">
<figure class="alignright is-resized"><a href="https://lh3.googleusercontent.com/JgSA8dGIUX2lsgumZ5P1vEALBga8bun-aGC85F9isEqWuG9qMPfwKRn1qx0osQGfM16IoxrcIylvVL1bpu-8cedE-dswKommurHldMNLXArR55a-aH64IvtPrhfUrHb4Ksxk-yB2oG1bu7Qfuw" target="_blank" rel="noreferrer noopener"><img loading="lazy" decoding="async" src="https://lh3.googleusercontent.com/JgSA8dGIUX2lsgumZ5P1vEALBga8bun-aGC85F9isEqWuG9qMPfwKRn1qx0osQGfM16IoxrcIylvVL1bpu-8cedE-dswKommurHldMNLXArR55a-aH64IvtPrhfUrHb4Ksxk-yB2oG1bu7Qfuw" alt="The fintech giant first enabled crypto buying and selling in late 2020, but users couldn’t transfer their assets to third-party wallets" width="395" height="205"/></a></figure></div>


The capability still applies only to bitcoin, ethereum, bitcoin cash and litecoin.



PayPal’s announcement carries weight, as the fintech giant has more than 426 million active users who use the network to transfer money around the world and to make payments to merchants.



In March last year, PayPal rolled out the ability for US customers to use crypto as a form of payment to merchants using its “<a href="https://newsroom.paypal-corp.com/2021-03-30-PayPal-Launches-Checkout-with-Crypto" target="_blank" rel="noreferrer noopener">Checkout with Crypto</a>” service.&nbsp;



“We will continue to roll out additional crypto features, products, and services in the months ahead,” Jose Fernandez da Ponte, general manager of blockchain, crypto and digital currencies at PayPal, said in a statement.



Dan Schulman, PayPal’s president and CEO, revealed last year the firm’s <a href="https://cms.blockworks.co/paypal-ceo-smart-contracts-defi-apps-part-of-companys-crypto-plans/" target="_blank" rel="noreferrer noopener">crypto capabilities</a> will expand into the use of central bank digital currencies and smart contracts.&nbsp;



Some of PayPal’s revenue stems from crypto purchases made on its platform, but the exact amount isn’t clear because the company excludes this figure from its total payment volume.



Venmo, a popular payments app owned by PayPal, supports the buying and selling of cryptocurrencies but doesn’t yet have the ability to transfer them externally. 



As for Robinhood, the trading app rolled out a <a href="https://cms.blockworks.co/robinhood-deploys-beta-crypto-wallets-allowing-select-customers-to-transfer-off-platform/" target="_blank" rel="noreferrer noopener">beta version</a> of its crypto wallet to 1,000 customers that allowed them to transfer digital assets to other crypto wallets for the first time in January. It later opened the feature to <a href="https://cms.blockworks.co/robinhood-opens-crypto-wallet-service-to-2-million-more-users/" target="_blank" rel="noreferrer noopener">2 million</a> more “eligible” users — <a href="https://blog.robinhood.com/news/2022/3/28/the-future-of-investing-is-247-s8ksg" target="_blank" rel="noreferrer noopener">excluding</a> those in New York, Hawaii and Nevada, due to regulatory hurdles.



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