The mainstream acceptance of cryptocurrencies has translated into many traditional payment channels opening their doors to the new asset class. Big-scale payment providers such as Visa and Mastercard and digital payment platforms such as Paypal have begun adding crypto support. However, these massive integrations did not take place in a vacuum and were result of larger market sentiments.
In a recent podcast, Paypal’s senior vice president and general manager of blockchain, crypto, and digital currencies, Jose Fernandez, remarked that Paypal deciding to offer crypto services was a combination of factors such as massive demand from both consumers and merchants for using crypto as a payment instrument along with regulatory clarity on the legality of the industry. He added,
“We thought that it was part of our responsibility to help in making this asset class more accessible to the public.”
Paypal had first introduced the option of buying, selling, and holding cryptocurrency on the platform in October last year. In its Q3 earnings report, the payment provider had also revealed plans to increase its crypto offerings in the coming future.
However, the rumors swirling around, about the release of its own stablecoin were vehemently denied by the exec. He said that the sector had not yet evolved to support the large volume and small value of its transactions.
Most stablecoins in the market are currently used for either trading or DeFi, according to Fernandez. Admitting that while these are good use cases, he said that Paypal is more interested in payments, and “we have not seen a stablecoin out there that is purpose-built for payments.”
However, all hope is not lost as the platform is actively keeping an eye on new L1 and L2 platforms that are focusing on payments at scale, such as Ethereum, Polkadot, Solana, and Algorand, he revealed, adding,
“I’m sure that if you ask me six weeks from now I could give you four or five different names. This is how exciting it is”
Apart from cryptocurrencies and stablecoins, another sector of the industry that Paypal has shown interest in is NFTs, which have seen a remarkable growth burst this year. Noting that he see “a role for us in NFTs”, for which he held high hopes, Fernandez added that several issues still interfered with such an integration. He said,
“The experience of buying an NFT today is the number of hoops that you need to go through… That goes to the protection side as well. So that is something that is definitely on the early adopter side, is not yet a mainstream experience for a curious but not sophisticated user.”
The technical complications to buy and hold NFTs could discourage many users from interacting with the sector, according to Fernandez, who added,
“We definitely have a role to play on how do we enable a seamless payment experience for NFT… many of our merchants and partners, especially in the media sector are asking for that.”
