Bitcoin, Ethereum, Litecoin, Bitcoin Cash… These cryptocurrencies still unknown to the general public will soon be used by Paypal customers in the United Kingdom, according to a statement from the company on August 23.
Criticized for their ecological cost and their very high volatility (due to the lack of regulation by central banks), these digital currencies, which operate thanks to a hypersecure digital transaction register called “Blockchain”, are still used by several million people around the world.
For Paypal, opening up to these currencies that have remained confidential for a long time makes it possible to remain competitive in a context of digitalization of the economy. “The pandemic (…) has accelerated the digitization of money and greater consumer adoption of digital financial services “, Justified Joseph Fernandez da Ponte, head of digital currencies at Paypal.
→ EXPLANATION. Bitcoin, the digital currency that keeps increasing in value
Concretely, in the weeks to follow, a new tab will allow PayPal customers to know in real time the price of these digital currencies and to obtain information on the opportunities and risks associated with their use. Each customer will then be able to acquire, store or sell one of these four cryptocurrencies, without distinction from fiat currencies.
Take the Crypto Corner ”
In October 2020, the electronic payment giant had already set up a similar buy-resale offer for its American customers. Since March, they can even make their purchases in partner companies using digital currency.
→ THE FACTS. Paypal will allow the use of cryptocurrencies for online payments
Although it has not been officially announced, this second option should logically apply to the UK market and perhaps in the long term, in all countries where Paypal is active.
“They have already taken up the challenge on the part trading, (i.e. buy-resale) but they are the first to launch into crypto ‘as a means of payment, analysis Nathalie Janson, teacher-researcher at Neoma Business School. They believe that this is a fundamental movement and that the blockchain is here to stay ”
This orientation may nevertheless come as a surprise because digital currencies are mainly used as a means of speculation and not of payment. To this day, this second use remains “Marginal” with “Less than 10% of activities in the case of bitcoin” according to the estimates of the cryptocurrency specialist.
This decision is part of a context of generalized awareness of both private and public actors of the opportunity represented by the emergence of cryptocurrencies. Like Facebook which, after two years of difficulties, has just announced the imminent launch of the “Diem” and its digital wallet.
→ READ. Cryptocurrency: after some hesitation, Facebook is ready to go
In its sector, Paypal goes much further than its direct competitors, such as Visa and Mastercard, which were satisfied, at the start of the year, to open the door to a few stablecoins, digital currencies backed by fiat currency, more stable than traditional cryptocurrencies.
His announcement immediately pulled up the price of bitcoin, which has just exceeded $ 50,000 (€ 43,000). An amount which had not been reached since May and which had been followed by a great collapse: – 15,000 dollars in a fortnight.
At that time, China had launched a vast offensive against the “mining” farms established on its territory. These computer chains are the beating heart of cryptocurrencies since they secure the transactions of the blockchain. The Chinese government was thus seeking to limit competition in order to promote the launch of its own digital currency, the “Digital yuan”.