In recent months, there has been a lot of news about cryptocurrencies, as the prices of some of the major digital currencies reached all-time highs.
More and more companies have also begun to adopt this new digital currency, including Tesla, Square and PayPal.
Tesla for example, now accepts bitcoin as payment for their electric cars. Although this mode of payment is only available in the U.S. for now, Elon Musk, founder and CEO, said it will be extended to customers outside the U.S. later this year.
In a recent interview with Time Magazine, PayPal CEO Dan Schulman shared some insights into how the company looks at cryptocurrency over the next few years. Here are some highlights:
Progressive elimination of the cash transaction
Because of COVID-19, PayPal shared that the United States saw a rapid digitization process three or five years before its projection.
For this reason, Schulman predicts a huge decline in cash use over the next five to ten years. This means that consumers will no longer use cash for payment as much as they do today.
With everything moving online, cash as a form of payment is no longer effective and efficient, and we are seeing the rapid rise of digital currencies.
No one wanted to touch cash, and this caused a huge increase in the use of digital forms to not only pay, but to look at menus and look at deals and stuff like that in stores.
– Dan Schulman, CEO of PayPal
Rapid modernization of the existing financial infrastructure
In addition to the rise of digital currencies in the next five to ten years, Schulman expects huge changes in the inefficient financial ecosystem today.
He explained that the fact that it can take three days to get your check covered, or seven days until an international remittance to reach the recipient, speaks volumes about the inefficiencies of the current financial system.
So when you think it’s expensive, exclusive, and efficient, we really need to start thinking about “How do you modernize this system?” Is there a way to do things more efficiently, with less cost, more inclusive, and add more utility to the system? ‘
– Dan Schulman, CEO of PayPal
One way to solve this is through a digital currency issued by the central bank, with the support of the government. Using a digital currency, payments can be instantaneous at no cost or friction.
Multiple demand for cryptocurrency
In November last year, PayPal announced which will allow all users to buy, sell and maintain cryptocurrencies from their PayPal account.
Since then, Schulman shared that the demand for the service has been “multiple” to what the team initially expected.
“There’s a lot of excitement,” he said simply.
In early March, PayPal launched another new feature that allows U.S. merchants to enable the “Checkout with Crypto” feature, which allows their customers to complete their online transaction using cryptocurrencies.
According to the company, customers who have bitcoins, ether, cash bitcoins and litecoin in PayPal’s digital wallets will now be able to convert their holdings into fiat currencies at checkout.
He added that this service will be available to all its 29 million merchants in the coming months.
The willingness of traders to adopt the technology needed to accept bitcoins as payment for their goods is clearly driven largely by business motivations, while the preferences of customers to which traders react may be considerably motivated by their support for Bitcoin for idealistic reasons.
As digital currencies become more and more accepted, we may soon see a turning point in terms of major digital currency adoption.
Cryptocurrency and blockchain technology is a key content pillar for Vulcan Post and we will continue to cover development in this space. You can follow our coverage here.
Featured Image Credit: Geoff Pugh via Telegraph