I won't try to predict when, if ever, they might do so, but I do think it's entirely possible they will if the market becomes big enough. There's been some sentiment here that Bitcoin is a direct competitor of Paypal, but I don't think that's really the case. Paypal is in the business of making it easier for people to send money to other people. Bitcoin does that too, to an extent, but as we've seen, keeping your wallet secure is a big task for many users, and if PayPal were to offer an Bitcoin wallet service, they could get a lot of users for that. Whether people would be willing to pay enough for the service for them to want to consider it is a different matter, but really I think PayPal would be just like any other on-line wallet service, only huge.
PayPal and Bitcoin aren't mutually exclusive at all, in one area that's pretty important for many buyers and sellers alike: Bitcoin is irreversible and that can be a big plus, but there are a lot of people who only use PayPal or similar when buying stuff because they want to be able to protect themselves. There are a lot of solutions to the problem -- reversible transactions is simply one. PayPal, Visa, and so forth, they take a cut in exchange for some measure of protection: Visa, for example, protects buyers from fraudulent merchants AND protects merchants from the loss when someone fraudulently makes a purchase with someone else's money. While there are a lot of people who would choose to have a no-fee transaction on both sides, and there are some people who would prefer things to be irreversible... Honestly, I've been burned enough times that the reality is the only way I'd ever use Bitcoins for a majority of my larger purchases is if I have a way of recovering my funds when a merchant rips me off. At the moment I often jump through a shitload of hoops to transfer everything I have into a specific bank account I have, just so that I have that bank's Visa fraud department to call if I have a problem with the purchase.
And that would simply be another case of free market offering multiple approaches, and individual consumers (in this case, both end-purchasers and merchants) can choose what they want.
paypal will never accept bitcoin
They'll accept it the picosecond they think that they'll make more money if they do than they will if they don't. They'll be supporters of Bitcoin instantly if they conclude there's more profit to be had by supporting it than attempting to interfere with it.
Whether they'll ever actually conclude that is the variable, but they're a corporation, they'll always do what they think will put the most money in their executives' pockets.
You hit the nail on the head, my friend!
Sure, paypal is the big kid on the block right now, but who's to say they won't start accepting bitcoin as one of many international currencies?
Simple, their TOS forbids currency changing so you cant buy BTC using paypal on exchanges.
Actually I wasn't referring to having PayPal allow users to exchange bitcoin for other currencies, but rather have PayPal accept bitcoin as one of their many payment options.