It has been years now since PayPal started getting involved in crypto. It made perfect sense for a money transfer platform to embrace new form of money. Just like banks PayPal found a new competition in bitcoin and other cryptocurrencies. New and better form of online payments technology was being developed and implemented at rapid speed. This could put services like PayPal out of business. This may still happen. Crypto offers much better solutions than what PayPal would ever offer. PayPal was a great idea for its time and had a huge impact in e-commerce and online money transfers. Will it stay relevant in the future? I am not so sure it will. But not pivoting to new realities and exploring ways to stay relevant in the future would be a mistake. PayPal hasn't made this mistake. However, it is not clear to me it has taken all the necessary steps.
So PayPal did get involved in crypto and started offering it on its platform for its users. Then it even tried its own stable coin. I am not sure if it still a thing. I lost interest in PayPal's crypto services long time ago and haven't used it much in recent years. However, there was a time I genuinely was interested in how buying, selling, holding crypto in PayPal worked. When I attempted to explore this, I wasn't able to. It didn't let me see anything crypto. That is because I had a business account. I have used PayPal a lot in the past, and still occasionally use it. I have used it both for personal and business purposes. At one point I upgraded my PayPal to a business account. Apparently, when PayPal started offering crypto on its platform it was only accessible for personal accounts and business accounts were blocked. That was a disappointment. Since I didn't really need crypto on PayPal, I didn't look any further.
Well now PayPal has announced that they will enable business accounts to buy, sell and hold crypto assets. I welcome this move, but I wonder if they are late for the game. Perhaps not. While it is great they allowed personal accounts to buy and sell crypto years ago, not giving the same access to the merchants kinda defeated the purpose. After all PayPal is a money platform that connects the buyers and sellers. Merchants would probably benefit more from PayPal's crypto services. It may still not be too late. Since crypto is still growing and new technologies are being developed for e-commerce use, and more merchants getting used to crypto, having a platform to sell them or buy them may be useful for many merchants.
PayPal has significant impact in the growth of e-commerce. Enabling merchants to accept payments and empowering ordinary people to make payments with their technology PayPal was an innovator of its time. It may not have created money, it may not have built a bank, but it was able to transform the money into the internet, and transition banks into the virtual world. Banks should have been the ones who came up with such solutions. But they move slow and don't have creative freedoms to innovate. PayPal filled space, and came up with something so obvious, so simple, and had huge demand. Providing an ability for people to send and receive their money with just their email addresses was revolutionary. It is like Hive accounts. We have easy to use wallet names people can send and receive money. Unlike Hive though PayPal had and has not so cheap fees for transactions. Of course not all of the fees go the PayPal, the underlying costs have to do how credit cards charge fees for transactions.
PayPal is not bank, never was one. They simply made agreements with banks to provide their services. But PayPal always had to follow the rules, guidelines, and conditions banks had set. In other words in most dispute banks would be right, and PayPal would be wrong. And such costs would go to the PayPal users. In most cases that would be the merchants who would lose money. Of course PayPal had to abide by the rules set by banks, otherwise they wouldn't be able to conduct their business. Banks would simply not work with PayPal if they didn't comply. Even in such conditions PayPal was super successful. It did well as a company. It did provide convenient way of transferring money for people, make payments for purchases online, and ability for merchants to accept money and build their online businesses. Overall all participants were happy.
PayPals best days were when it was the primary method of payment for eBay. E-commerce was booming and companies like eBay were doing great. People were already using PayPal on eBay. Then eBay decides to buy PayPal. Why not? Makes perfect sense. As a contender to become the top online marketplace, eBay needed a well working, globally recognized money transfer system. PayPal was a great solution and buying it was a great move. Amazon on the other hand went another route and built its own payment system just for Amazon and was charging crazy fees too. Two different models, but they both did well. Late eBay would decide to separate the two companies eBay and PayPal and let them operate separately. Although PayPal would still be the primary method of payments. I don't think this is the case now. eBay has a new payment system now where they process the payments and don't need to go through PayPal.
It is really impressive what PayPal has done over the years and how it grew as a company. Emergence of crypto solutions to money like bitcoin put PayPal in direct competition with crypto. Bitcoin and crypto assets offer cheap transaction fees and remove the necessity for a middleman. Money solutions like Hive offer even better options. Transfers are free, fast and peer-to-peer. In my opinion, Hive and HBD are probably the best solutions for e-commerce. We are not there as far as the crypto adoption in e-commerce yet. This will take more time with lawmakers removing obstacles and people choosing better money. Sooner or later it will happen.
PayPal is/was terrible for micropayments. Bitcoin and other crypto assets easily solves this problem. Selling products that cost less than a dollar or even slightly above would put merchants and buyers in disadvantage because more than half of the transaction value would be taken away in transfer fees. With Hive none of this value would be lost. It is not PayPal's fault. They have to play by the rules set by the banks. I am not sure if I ever will use PayPal for buying or selling crypto, but it sure is good to know that this option is available. The more crypto friendly platform, the better.
