PayPal Supports Crypto, But Worries About Bad Actors

We are an end-to-end payment and trading company, so we believe there are opportunities to enhance and enhance the payment experience. I’m sure you’re aware of this, but for your readers who may not have experienced what it’s like to load up a Metamask wallet and go through this whole process, it’s really quite painful.

“We want to make sure we’re operating in a compliant environment, so when I see these things happening that hurt consumers and give the industry a bad name, it’s certainly disturbing.”

Edwin Aok

We see opportunities to really start streamlining the ability to facilitate payments and commerce in the Web3 space.

But that’s just the beginning: when we get into Web3, we get into programmable payments and we get into this fundamental financial service.

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I think there could certainly be other things that could come out of it that we might not have even imagined.

Do you have any idea what they could be?

I mean, this is mostly speculation, but there are a few areas that I think could be quite interesting. About NFTs [non-fungible tokens]“I think there are some interesting aspects, not necessarily the gathering space, but the use of NFTs for things like ticketing, where you can enforce uniqueness and facilitate legitimate secondary markets. NFTs also have the ability to ensure that creators and artists continue to reap the benefits of continued interest in their work and share in resale revenue.

“It’s still early,” says Edwin Aoki.

Another non-paying use case for Web3 is for identity. When you start looking at this idea of ​​decentralized, self-sovereign digital identity, you explore this idea to empower users with control over the data they share. You can bring these disparate sources of information together, such as the state government, your employer, your university. Being able to take that and syndicate it in an interesting way where the user is still at the center.

I think when people think about crypto these days, they usually think about the technology behind it. They don’t even think about buying their lunch with it. For a company like PayPal, are you still in that “well, maybe people want to buy their lunch with crypto, and maybe we can facilitate that” mentality?

It’s still early. When we first started with online payments or with a credit card and a touch to pay for a $2 transaction, it was really foreign and really weird. But we do it all the time now, don’t we? So I think it’s hard to predict exactly where crypto payouts will go.

That said, there are certainly challenges with today’s most popular cryptocurrencies in terms of gas rates, throughput, volatility or access that I think we as an industry need to overcome in order for this to become a viable payment model.

But I think we’ve shown that there is interest, especially from traders. Here in Australia there is an overwhelming opinion that it will come, and in the United States we did a survey and a large majority of those people said their consumers are asking for digital currency payments.

So I feel there are technical challenges to overcome. The use of this digital currency presents structural problems. But that’s definitely the case, I think over time we’ll see them become more useful as a payment mechanism.

PayPal is a large publicly traded company. Have you ever looked at the web3 space and worried about the quality of companies operating in the industry? There’s a great website called “Web3 Just Goes Great” that keeps track of all the major outages in the space, and there’s regular talk of a company losing millions of dollars in customer money or whatever.

Oh yes, I saw it.

Are you concerned about this as a large company and do you want to break into this space?

Absolutely, that worries us. We are very attached to this notion of responsible innovation, the safety of our customers comes first. We want to make sure we work in a compliant environment, so when I see these things happening that hurt consumers and give the industry a bad name, it’s certainly disturbing.

For PayPal, we have space control over how we create and position our offers ourselves. Our view is that we’re going to use all the parts people trust about PayPal and the experience we have in this area as a regulated company to try to bring that sensitivity into Web3.

On the regulatory side, we’ve seen action in the US against things like Tornado Cash and some recent announcements in Australia. What is your opinion on the measures that regulators are currently taking?

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We assume that regulators mean well. I think regulators and policy makers generally want to do the right thing for their voters. They want to make sure consumers are protected. They want to ensure that the financial system is structurally sound.

But there’s a fine line between making sure customers are properly protected, educated and informed about both the opportunities and the risks. But at the same time you want to have a mechanism that really stimulates innovation. Anyone who does not respond to the last blog title “Web3 is just going well”.

What matters to us is that we take a responsible position in this. We’re going to see this space evolve, just like we’ve seen, you know, online payments evolve or some of the other things that we now take for granted. And I think the regulatory and legislative agendas will get there over time.

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