Why Paypal’s enterance in to crypto is important
Paypal: Buy, sell and transact
From Yahoo, PayPal has entered the cryptocurrency market, announcing that its customers will be able to buy and sell Bitcoin and other virtual currencies using their PayPal accounts.
But this is the newsworthy piece:
Those virtual coins could then be used to buy things from the 26 million sellers which accept PayPal.
Disrupting Payments, Disrupting Banks
If we look at the existing mainstream venues to buy bitcoin, Square and Robinhood being most notable, they allow you only to buy and sell crypto. It’s an investment use case. Take some of your dollars and instead of earning little to no interest, you can store those dollars in a crypto asset instead.
With Paypal, you can buy bitcoin and then use it to purchase goods. You aren’t actually paying in bitcoin, Paypal does a conversion of bitcoin to dollars and the seller gets dollars in their paypal account.
Will this push banks to provide the same service?
How it changes bitcoin
What it does change is the predominate use case. For the past three years, most of the cryptocurrency activity has been around “investments” – buying, selling and transacting for profit (hopefully). With Paypal allowing transactions, you can actually buy something with bitcoin, other than a pizza for 10,000 bitcoin.