2013-04-24 Bloomberg - Paypal considering adding bitcoin as a funding method

[lebing]

http://www.bloomberg.com/video/paypal-sees-20-billion-in-mobile-transactions-WlokACTBRterdjHAJGNB6w.html

Yes, really.

[1715456552]

1715456552

[1715456552]

1715456552

[kiko]

Please can you add the date and Bloomberg source to the thread title.
Many thanks.

[kerogre256]

http://www.bloomberg.com/video/paypal-sees-20-billion-in-mobile-transactions-WlokACTBRterdjHAJGNB6w.html

Yes, really.

You forgot abaut date ffs.

[xcsler]

Where there is smoke there is fire!
Marcus' facial expression seemed to change dramatically, in a positive way, when BTC was mentioned.
He said that they were "thinking about it" but I suspect given his reaction that they are rather doing more planning and preparing.
JMTS (just my 2 satoshis)

[kiko]

Marcus' facial expression seemed to change dramatically, in a positive way, when BTC was mentioned.

You can't really "look into" bitcoin seriously without doing some reading on this forum. He was probably imagining this place blowing up as he said it.

[lebing]

Please can you add the date and Bloomberg source to the thread title.
Many thanks.

Updated

[DataPlumber]

Comments are at 2:50 - 3:35

[kiko]

Please can you add the date and Bloomberg source to the thread title.
Many thanks.

Updated

Sorry to be a pedant, but the date should be 2013-04-24.  Some day we would like to get this section to Alpha-sort into correct order.
Thanks again.

[lebing]

Please can you add the date and Bloomberg source to the thread title.
Many thanks.

Updated

Sorry to be a pedant, but the date should be 2013-04-24.  Some day we would like to get this section to Alpha-sort into correct order.
Thanks again.

np - done

[nebulus]

"Yes, I can't wait to start funding my PayPal account with BTC..."

[kiko]

"Yes, I can't wait to start funding my PayPal account with BTC..."

That is a weird thought indeed. Unless they implement a dual balance, you might as well just sell all your coin and use a credit card. At least you get air miles then. We need to lobby hard for first class citizenship if they do enable bitcoin.

[Gordonium]

Marcus' facial expression seemed to change dramatically, in a positive way, when BTC was mentioned.

You can't really "look into" bitcoin seriously without doing some reading on this forum. He was probably imagining this place blowing up as he said it.

+1 

[deepceleron]

Drinking game: drink when you smell the BS.

"We never share financial data".  You mean with banks, the IRS, FinCen, or law enforcement?

"You can eventually break into an account if it's only protected by a password"

"We have a policy, if anything happens, it's on us. You'll never lose a penny by using PayPal"

"ordering your Jamba Juice online saves 15 minutes from your daily routine".

And this guy goes real genius, saying they should replace passwords with fingerprints (a non-changeable and ambiguous password not rooted in cryptography, that can easily be extracted from you, and which many governments already have on record.)

Their interest in Bitcoin is likely limited to strategic campaign donations.

[Technomage]

Meganews.

[StarfishPrime]

If it actually happens it would be the largest btc adoption news yet, by orders of magnitude. Far greater than Western Union, etc. Paypal's market penetration and transaction volume are huge.

Basically it means btc would be spendable anywhere Paypal is - through Paypal of course. Actually it's a brilliant strategy, they still get their 3-5% cut when you spend, and they significantly reduce the incentive for online retailers to adopt bitcoin at all.

  

[Le Happy Merchant]

...and they significantly reduce the incentive for online retailers to adopt bitcoin at all.

I strongly disagree with this. In what way can you justify this? I have a case for the opposite.

[StarfishPrime]

...and they significantly reduce the incentive for online retailers to adopt bitcoin at all.

I strongly disagree with this. In what way can you justify this? I have a case for the opposite.

Retailers will always weigh risk vs. benefit. If they'd rather just pay the 3-5% and not 'bother' with bitcoin, many will unfortunately.

As bitcoin use and awareness grows, and the exchange rate stabilizes, the incentive (no fees, no chargebacks) will eventually tip the scales toward adoption. Paypal's strategy will just slow down the process IMHO.

[lebing]

...and they significantly reduce the incentive for online retailers to adopt bitcoin at all.

I strongly disagree with this. In what way can you justify this? I have a case for the opposite.

Retailers will always weigh risk vs. benefit. If they'd rather just pay the 3-5% and not 'bother' with bitcoin, many will unfortunately.

As bitcoin use and awareness grows, and the exchange rate stabilizes, the incentive (no fees, no chargebacks) will eventually tip the scales toward adoption. Paypal's strategy will just slow down the process IMHO.

who says that their fees will be 3-5% for bitcoin transactions? They know better to keep an increased margin in the face of rapid numbers of competitors. They may be able to get away with that margin as a first mover for awhile, but in a year from now there is no chance they will succeed at those levels. People will simply move to the new beautiful baby silicon valley spawns to suck from the teet of the dinosaur.

[StarfishPrime]

...and they significantly reduce the incentive for online retailers to adopt bitcoin at all.

I strongly disagree with this. In what way can you justify this? I have a case for the opposite.

Retailers will always weigh risk vs. benefit. If they'd rather just pay the 3-5% and not 'bother' with bitcoin, many will unfortunately.

As bitcoin use and awareness grows, and the exchange rate stabilizes, the incentive (no fees, no chargebacks) will eventually tip the scales toward adoption. Paypal's strategy will just slow down the process IMHO.

who says that their fees will be 3-5% for bitcoin transactions? They know better to keep an increased margin in the face of rapid numbers of competitors. They may be able to get away with that margin as a first mover for awhile, but in a year from now there is no chance they will succeed at those levels. People will simply move to the new beautiful baby silicon valley spawns to suck from the teet of the dinosaur.

My assumption is that they'll allow bitcoin funding but not bitcoin balances. This would suit their fee structure optimally. No doubt they will adapt if they need to, but at this time they wouldn't really need to allow a BTC balance or accept reduced fees. It will be very interesting, whatever they do.

[RodeoX]

I wonder what will happen when they figure out that while you may choose to use bitcoin with paypal, almost all the services they offer are made obsolete by bitcoin.

[lebing]

...and they significantly reduce the incentive for online retailers to adopt bitcoin at all.

I strongly disagree with this. In what way can you justify this? I have a case for the opposite.

Retailers will always weigh risk vs. benefit. If they'd rather just pay the 3-5% and not 'bother' with bitcoin, many will unfortunately.

As bitcoin use and awareness grows, and the exchange rate stabilizes, the incentive (no fees, no chargebacks) will eventually tip the scales toward adoption. Paypal's strategy will just slow down the process IMHO.

who says that their fees will be 3-5% for bitcoin transactions? They know better to keep an increased margin in the face of rapid numbers of competitors. They may be able to get away with that margin as a first mover for awhile, but in a year from now there is no chance they will succeed at those levels. People will simply move to the new beautiful baby silicon valley spawns to suck from the teet of the dinosaur.

My assumption is that they'll allow bitcoin funding but not bitcoin balances. This would suit their fee structure optimally. No doubt they will adapt if they need to, but at this time they wouldn't really need to allow a BTC balance or accept reduced fees. It will be very interesting, whatever they do.

That doesnt really make sense. Who would use them just to convert to cash? There are plenty of other places to do that already. The real value for the consumer here is the FDIC insured, household brand name wallet that makes them feel safe and cuddly when they hold their bitcoins there. Make no mistake about it, this is the smart and only play.

[deepceleron]

It should be noted before getting too excited, like some of these responses are, actually read my transcription, and remember that he probably wasn't expecting to talk about Bitcoin.

GJ: Can I ask you something - left-field question?
DM: Sure
GJ: Bitcoin...
DM: Uh-huh
GJ: virtual currencies...what do you make of that?
DM: So, I've been spending a lot of time looking at it,
GJ: I'm sure
DM: and it's truly fascinating, actually, the way the, that the currency's been designed, and the way that, uh, you know, inflation is built in to pay for miners, and...
GJ: Yeah
DM: all that is truly fascinating. Um, and I think, you know for us at PayPal, it's just a question of...whether Bitcoin will make it's way to PayPal as a funding instrument or not, and uh, and ya know, we're kind of uh.. of thinking about it.
GJ: I, I guess, like yeah, like the rest of us, we're all kind of watching it, sort of with, with, with a great deal of interest, but kind of, a lot of people have been taken aback by, by the sort of.. of the velocity of the moves.

[BitSmile]

We live in interesting times

[lebing]

It should be noted before getting too excited, like some of these responses are, actually read my transcription, and remember that he probably wasn't expecting to talk about Bitcoin.

GJ: Can I ask you something - left-field question?
DM: Sure
GJ: Bitcoin...
DM: Uh-huh
GJ: virtual currencies...what do you make of that?
DM: So, I've been spending a lot of time looking at it,
GJ: I'm sure
DM: and it's truly fascinating, actually, the way the, that the currency's been designed, and the way that, uh, you know, inflation is built in to pay for miners, and...
GJ: Yeah
DM: all that is truly fascinating. Um, and I think, you know for us at PayPal, it's just a question of...whether Bitcoin will make it's way to PayPal as a funding instrument or not, and uh, and ya know, we're kind of uh.. of thinking about it.
GJ: I, I guess, like yeah, like the rest of us, we're all kind of watching it, sort of with, with, with a great deal of interest, but kind of, a lot of people have been taken aback by, by the sort of.. of the velocity of the moves.

Whats your point?

[flix]

It should be noted before getting too excited, like some of these responses are, actually read my transcription, and remember that he probably wasn't expecting to talk about Bitcoin.

GJ: Can I ask you something - left-field question?
DM: Sure
GJ: Bitcoin...
DM: Uh-huh
GJ: virtual currencies...what do you make of that?
DM: So, I've been spending a lot of time looking at it,
GJ: I'm sure
DM: and it's truly fascinating, actually, the way the, that the currency's been designed, and the way that, uh, you know, inflation is built in to pay for miners, and...
GJ: Yeah
DM: all that is truly fascinating. Um, and I think, you know for us at PayPal, it's just a question of...whether Bitcoin will make it's way to PayPal as a funding instrument or not, and uh, and ya know, we're kind of uh.. of thinking about it.
GJ: I, I guess, like yeah, like the rest of us, we're all kind of watching it, sort of with, with, with a great deal of interest, but kind of, a lot of people have been taken aback by, by the sort of.. of the velocity of the moves.

Whats your point?

Sure, it's not an official announcement of any sort. However the unexpected quality makes it even more revealing...

[lebing]

It should be noted before getting too excited, like some of these responses are, actually read my transcription, and remember that he probably wasn't expecting to talk about Bitcoin.

GJ: Can I ask you something - left-field question?
DM: Sure
GJ: Bitcoin...
DM: Uh-huh
GJ: virtual currencies...what do you make of that?
DM: So, I've been spending a lot of time looking at it,
GJ: I'm sure
DM: and it's truly fascinating, actually, the way the, that the currency's been designed, and the way that, uh, you know, inflation is built in to pay for miners, and...
GJ: Yeah
DM: all that is truly fascinating. Um, and I think, you know for us at PayPal, it's just a question of...whether Bitcoin will make it's way to PayPal as a funding instrument or not, and uh, and ya know, we're kind of uh.. of thinking about it.
GJ: I, I guess, like yeah, like the rest of us, we're all kind of watching it, sort of with, with, with a great deal of interest, but kind of, a lot of people have been taken aback by, by the sort of.. of the velocity of the moves.

Whats your point?

Sure, it's not an official announcement of any sort. However the unexpected quality makes it even more revealing...

Yeah exactly. It was like a window into their high level discussions/ strategy inside Paypal. You could tell by his sheepishness that it is a major strategic point for the company.

[xcsler]

"DM: and it's truly fascinating, actually, the way the, that the currency's been designed, and the way that, uh, you know, inflation is built in to pay for miners, and..."

The fact that the head of Paypal seems to accept BTC as a currency, calls it fascinating and is aware of miners tells me that they have done at least some homework on the subject. This implies that Paypal does view BTC as a real competitor to their business model. The guy sees the value in BTC. He didn't blow it off with the usual FUD talk. The rest of the year could end up being even more interesting than it has already been!

[StarfishPrime]

...and they significantly reduce the incentive for online retailers to adopt bitcoin at all.

I strongly disagree with this. In what way can you justify this? I have a case for the opposite.

Retailers will always weigh risk vs. benefit. If they'd rather just pay the 3-5% and not 'bother' with bitcoin, many will unfortunately.

As bitcoin use and awareness grows, and the exchange rate stabilizes, the incentive (no fees, no chargebacks) will eventually tip the scales toward adoption. Paypal's strategy will just slow down the process IMHO.

who says that their fees will be 3-5% for bitcoin transactions? They know better to keep an increased margin in the face of rapid numbers of competitors. They may be able to get away with that margin as a first mover for awhile, but in a year from now there is no chance they will succeed at those levels. People will simply move to the new beautiful baby silicon valley spawns to suck from the teet of the dinosaur.

My assumption is that they'll allow bitcoin funding but not bitcoin balances. This would suit their fee structure optimally. No doubt they will adapt if they need to, but at this time they wouldn't really need to allow a BTC balance or accept reduced fees. It will be very interesting, whatever they do.

That doesnt really make sense. Who would use them just to convert to cash? There are plenty of other places to do that already. The real value for the consumer here is the FDIC insured, household brand name wallet that makes them feel safe and cuddly when they hold their bitcoins there. Make no mistake about it, this is the smart and only play.

Well, it would certainly be huge if they did carry btc balances and do btc transactions, it'd be easy enough for them to just add another currency (btc). They'd suddenly be in competition with Coinbase, BitPay, etc, and - since they'd be an exchange - every other exchange including Mt.Gox. Seems pretty unlikely, though. The only reason anyone would want/need to send bitcoin through paypal would be the perceived safety of the chargeback and dispute resolution 'features' of Paypal.

[lebing]

...and they significantly reduce the incentive for online retailers to adopt bitcoin at all.

I strongly disagree with this. In what way can you justify this? I have a case for the opposite.

Retailers will always weigh risk vs. benefit. If they'd rather just pay the 3-5% and not 'bother' with bitcoin, many will unfortunately.

As bitcoin use and awareness grows, and the exchange rate stabilizes, the incentive (no fees, no chargebacks) will eventually tip the scales toward adoption. Paypal's strategy will just slow down the process IMHO.

who says that their fees will be 3-5% for bitcoin transactions? They know better to keep an increased margin in the face of rapid numbers of competitors. They may be able to get away with that margin as a first mover for awhile, but in a year from now there is no chance they will succeed at those levels. People will simply move to the new beautiful baby silicon valley spawns to suck from the teet of the dinosaur.

My assumption is that they'll allow bitcoin funding but not bitcoin balances. This would suit their fee structure optimally. No doubt they will adapt if they need to, but at this time they wouldn't really need to allow a BTC balance or accept reduced fees. It will be very interesting, whatever they do.

That doesnt really make sense. Who would use them just to convert to cash? There are plenty of other places to do that already. The real value for the consumer here is the FDIC insured, household brand name wallet that makes them feel safe and cuddly when they hold their bitcoins there. Make no mistake about it, this is the smart and only play.

Well, it would certainly be huge if they did carry btc balances and do btc transactions, it'd be easy enough for them to just add another currency (btc). They'd suddenly be in competition with Coinbase, BitPay, etc, and - since they'd be an exchange - every other exchange including Mt.Gox. Seems pretty unlikely, though. The only reason anyone would want/need to send bitcoin through paypal would be the perceived safety of the chargeback and dispute resolution 'features' of Paypal.

I dont really see them being an exchange at all actually (at least not at first). Exchange isnt really a core competency of theirs. I see them holding coins in a safe place and integrating with fiat so you can pay both ways with one account anywhere.

[ManBearPig]

He gave a fairly diplomatic response but then would he say, "Oh noez there goes our profitz!1"

He finds it "interesting" because it challenges the very existence of PayPal and to say otherwise would cause shareholder panic.

[Rygon]

They could end up as an escrow service for bitcoin transactions. No one would argue that Paypal doesn't do an amazing job protecting buyers. Of course, they end up siding with obvious scammers and changing sellers outrageous fees.

[Dusty]

It should be noted before getting too excited, like some of these responses are, actually read my transcription, and remember that he probably wasn't expecting to talk about Bitcoin.

GJ: Can I ask you something - left-field question?
DM: Sure
GJ: Bitcoin...
DM: Uh-huh
GJ: virtual currencies...what do you make of that?
DM: So, I've been spending a lot of time looking at it,
GJ: I'm sure
DM: and it's truly fascinating, actually, the way the, that the currency's been designed, and the way that, uh, you know, inflation is built in to pay for miners, and...
GJ: Yeah
DM: all that is truly fascinating. Um, and I think, you know for us at PayPal, it's just a question of...whether Bitcoin will make it's way to PayPal as a funding instrument or not, and uh, and ya know, we're kind of uh.. of thinking about it.
GJ: I, I guess, like yeah, like the rest of us, we're all kind of watching it, sort of with, with, with a great deal of interest, but kind of, a lot of people have been taken aback by, by the sort of.. of the velocity of the moves.

Whats your point?

Just look at his face during those answers...
You don't have to be a Lie To Me addict to understand his expression that means "You can't imagine how much I'm so uber long bitcoins" ;-)

[101111]

I can see this potentially giving Ebay a massive boost too, if not there will be some competition from one of the new upstart bitcoin marketplaces.

[Zaih]

This is HUGE lol.

I'm surprised Bitcoin isn't $200/ea atm. haha

[WilderedB]

I'd be delighted to be able to buy BTC with Paypal, and sure it would be nice to be paid and stick my coins into Paypal as a convenient way to convert and cash them out for local currency.

I wouldn't leave any significant balance in there, obviously.

[inge]

I want first see it and then believe it...

[bit777]

That's possible since the paypal founder invested in a bitcoin company. They like the idea.

[lebing]

That's possible since the paypal founder invested in a bitcoin company. They like the idea.

What did I miss? o.0