John Rainey, Paypal CFO said in an interview with CNBC last May 16th that PayPal has little interest in digital currencies because price volatility threatens the viability of their merchants’ businesses.
Centralized payment service PayPal was one of the first companies that accepted cryptocurrencies, allowing merchants the option to accept Bitcoin (BTC) on the platform as far back as 2014, when BTC was worth around $400.
Nowadays, though, Rainey stated that PayPal currently doesn’t see much interest in digital currencies from their merchants, as the volatile nature of cryptocurrencies can cause losses, explaining:
“If you’re a merchant and you have, let’s say, a 10 percent margin on a product that you sell and you accept Bitcoin, for example, and the very next day it moves 15 percent, you’re now underwater on that transaction… You could have something that appeals to consumers, but if merchants don’t accept it, it’s of little value. Right now, we don’t see a lot of interest from our merchants.”
“But if it’s something that stabilizes in the future and is a better currency, then we’ll certainly support that,”
Rainey’s statement supports PayPal’s patent filed in March, which aims to speed up cryptocurrency transaction times. If the technology can be implemented on a large commercial scale, it could allow cryptocurrency payments to be processed between merchants and buyers instantly and off-chain, eliminating large transaction fees and long verification periods.
PayPal, launched 1998, has around 237 million registered active users, with a payment volume of $132 billion in the first quarter of 2018 alone, up by more than $30 billion since the first quarter of 2017.
In related news, Square CEO Jack Dorsey expressed optimism towards global adoption of digital currency. At the Consensus conference, Dorsey shared his vision that cryptocurrencies are the future of a legitimate means of global payment, which reaffirms his previous comments that Bitcoin will become the world’s “single currency” within a decade.