Speculation: Fintech Giants Paypal and Venmo to Launch Crypto Payments Service
As per reliable fintech sources, we have learned that PayPal is planning to launch a crypto transaction system as an alternative to crypto exchanges. The same source has also speculated that Venmo is also joining PayPal in the crypto exchange system, powering new digital banking and payment technology using crypto as the core.
Experts from the blockchain and crypto-based Fintech companies spoke to me about PayPal’s push into the crypto payments exchange. This Crypto roundup includes insights from
- Nicholas Pelecanos, Head of Trading at NEM.Io
- Seamus Donoghue, VP Sales and Business Development at METACO
- Konstantin Richter, CEO and Founder of Blockdaemon
Crypto is Tantalizinging and Good to Have in Fintech
“Bitcoin’s adoption rate has always been hindered by two main factors: a lack of understanding of the asset and a lack of understanding on how to gain exposure. If PayPal does list Bitcoin to its user base, this will help solve the latter, while the buzz created by this news will address the former.”
“In 2017, despite these two inhibiting factors, the cryptocurrency market cap surpassed $500 billion. Since then numerous on-ramps have emerged, if the rumors are true, PayPal will be the biggest yet, making the growth prospects of the space tantalizing.”
PayPal’s CashApp is a Sustainable Platform
Seamus Donoghue added,
“There are two clear takeaways from the PayPal and Venmo news: firstly, crypto has a new on-ramp that will provide access to their 325+ million users. If the rumors are indeed true that the payments giant will only be offering Bitcoin then this is the best news of the year for Bitcoin adoption and will likely be a strong catalyst to drive further adoption and the next leg higher in price.
The news offers another affirmation that traditional payment players can no longer ignore the potential business opportunity presented by crypto, and are now even willing to risk disrupting their own fiat-based platforms. Evidently, PayPal has seen the success Cash App has had with crypto and wants a piece of the pie, and may view Venmo as a potential means of building a similar, sustainable business model. In 2017, retail fear of missing out was the theme that drove BTC towards $20,000–the interesting question now is: are we on the edge of an institutional fear of missing out that could bring crypto into the mainstream?”
PayPal-Venmo Role in Crypto-type Payments
Konstantin Richter highlighted the PayPal-Venmo role in crypto-type payments.
Konstantin said, “On and off-boarding to crypto are still the major bottle-necks in mainstream adoption.
These barriers are often due to issues with KYC and regulatory complexity, as well as a lack of familiarity with terms of service and user experience design. Paypal would help break down these barriers by bringing hundreds of millions of users familiar with online payments closer to crypto–a significant proportion of these user cohorts are also likely to engage with crypto.
Other payment projects will be excited to see this announcement as it will bring greater familiarity with crypto type payments to the market. Libra is a messaging payments tool, so it will most likely benefit from, rather than compete directly with Paypal’s entry to the market.
Venmo is particularly interesting in this context, particularly if funds may also be used as payments directly out of the app, although this does not currently seem to be the plan, as this would bring even more privacy concerns and decentralization issues than Libra to its platform.
Interestingly, the payment data shared by Venmo–which still has a large millennial user base–reflects the disparity between what crypto-native experts want (decentralization), and actual users (easy instant payments with one or 2 clicks).”
To share your insights with us, please write to us at email@example.com