PayPal Plans to Form Partnerships With Central Banks and Support CBDCs

Ten days after PayPal announced the launch of its cryptocurrency trading services, CEO Dan Schulman has provided additional details into the future plans.

During the Q3 2020 earnings call, the CEO sad that PayPal will make an aggressive push in the cryptocurrency market in 2021. As per its existing plans, PayPal will first launch its Bitcoin and other crypto trading service first in the U.S, over the coming weeks.

Citing the recent growth in the digital payments and financial sector, CEO Schulman said: “Clearly the world is rapidly moving from physical to digital”. Citing all the recent developments by the regulators and central banks, Shulman noted: “There is no question that digital currencies are going to be rising in importance, having increasing functionality, and increasing prominence.”

Specifically putting a major emphasis on central bank digital currencies (CBDCs), the PayPal chief executive asserted: “CBDCs [...] are a matter of when and how they’re done, and not if. He added that with PayPal’s scale of operations, “help shape the utility of [CBDCs],” that includes facilitating the acceptance against different merchant locations and their interoperability with the existing payment system.

Taking a shot at the traditional financial systems, Schulman noted that they are not working for the ordinary people. He further added: “I do think that our platform and all the new digital infrastructure that we’re putting in place right now can help make that management and movement of money more efficient, less expensive, and faster.”

Talking about the company’s timeline, Schulman noted that PayPal will let allows its crypto account holders to spend their digital assets at all the 28 million merchant locations worldwide that are registered with PayPal. Schulman has assured that there won’t be any jump in the fees either for the customers or the merchants.

There have been some early reports of some people in the U.S. getting access to PayPal’s crypto services. Speaking about it, Schulman said: “We’re seeing people who have already bought crypto open their wallet several times a day to check out what’s happening with their crypto investments”. The rest of the United States will get access to PayPal’s crypto service by the end of December 2020.

Looking at the current demand, the PayPal executive also noted that they will increase the weekly crypto purchase limit from the existing $10,000 to $15,000.