Why should we welcome centralized bodies for Bitcoin mainstream

[suzanne5223]

What brought up this issue was the conversation and people's opinions after the Paypal announcement of integrating buy, sell, and hold of cryptocurrency.
Understandably, the decentralization of cryptocurrency is what makes it the liberty of the people from the government/economic meltdown and there also some discussion that the government's stance towards Bitcoin was the reason why Bitcoin is not mainstream of payments. I once read from a legendary crypto enthusiast once that for crypto to be mainstream a little sacrifice(centralization) will be needed which come to pass in Paypal crypto announcement and conditions which led to a lot of discussions in crypto communities.
We are the one claiming the government's stance towards crypto hinder crypto mainstream and Paypal shift to crypto seems to bridge the gap.

Below are the important statement posted on the Paypal newsroom.

The migration toward digital payments and digital representations of value continues to accelerate, driven by the COVID-19 pandemic and the increased interest in digital currencies from central banks and consumers. PayPal Holdings, Inc. (NASDAQ: PYPL) today announced the launch of a new service enabling its customers to buy, hold and sell cryptocurrency directly from their PayPal account, and signaled its plans to significantly increase cryptocurrency's utility by making it available as a funding source for purchases at its 26 million merchants worldwide.

Mainstream adoption of cryptocurrencies has traditionally been hindered by their limited utility as an instrument of exchange due to volatility, cost and speed to transact. However, the promise of advanced technological platforms offers the possibility of mainstreaming digital currencies. According to a survey by the Bank for International Settlements, one in 10 central banks – representing approximately one-fifth of the world's population – expect to issue their own digital currencies within the next three years.

"The shift to digital forms of currencies is inevitable, bringing with it clear advantages in terms of financial inclusion and access; efficiency, speed and resilience of the payments system; and the ability for governments to disburse funds to citizens quickly," said Dan Schulman, president and CEO, PayPal. "Our global reach, digital payments expertise, two-sided network, and rigorous security and compliance controls provide us with the opportunity, and the responsibility, to help facilitate the understanding, redemption and interoperability of these new instruments of exchange. We are eager to work with central banks and regulators around the world to offer our support, and to meaningfully contribute to shaping the role that digital currencies will play in the future of global finance and commerce."

Building Understanding and Adoption of Cryptocurrency

To increase consumer understanding and adoption of cryptocurrency, the company is introducing the ability to buy, hold and sell select cryptocurrencies, initially featuring Bitcoin, Ethereum, Bitcoin Cash and Litecoin, directly within the PayPal digital wallet. The service will be available to PayPal accountholders in the U.S. in the coming weeks. The company plans to expand the features to Venmo and select international markets in the first half of 2021. The service is enabled in the U.S. through a partnership with Paxos Trust Company, a regulated provider of cryptocurrency products and services.

Increasing the Utility of Cryptocurrency in Digital Commerce

Beginning in early 2021, PayPal customers will be able to use their cryptocurrency holdings as a funding source to pay at PayPal's 26 million merchants around the globe. Consumers will be able to instantly convert their selected cryptocurrency balance to fiat currency, with certainty of value and no incremental fees. PayPal merchants will have no additional integrations or fees, as all transactions will be settled with fiat currency at their current PayPal rates. In effect, cryptocurrency simply becomes another funding source inside the PayPal digital wallet, adding enhanced utility to cryptocurrency holders, while addressing previous concerns surrounding volatility, cost and speed of cryptocurrency-based transactions

With the quoted messages the question is should we welcome centralized bodies like Paypal or not since its operation will not be different from a centralized exchange and payment site?

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[20kevin20]

for crypto to be mainstream a little sacrifice(centralization) will be needed

It's a big sacrifice. Bitcoin is here to avoid centralization, it just doesn't make sense to welcome it this way.

I understand there are so many merchants that'll allow Bitcoin payments which is great, but I'm not sure it's going to be Bitcoin you'll be paying with. Without full control over the coins, it's just like PayPal created a virtual Bitcoin and allowed you to use it. I'm really curious to find out if the "purchases using Bitcoin" are going to be done over the blockchain or PayPal takes the BTC and gives you virtual ones.

[hulla]

What I'm about say will hurt alot of crypto enthusiast but we need to be realistic cause if we by any means we wants Bitcoin and others good cryptocurrencies to succeed in becoming the mainstream we have to open our arms for some centralized bodies which I see Paypal as one of them since we also use centralized exchange site sometime but people are not to use them as wallet or exchange site but for payment.

 

[Fundamentals Of]

If the price for adoption is that Bitcoin is going to be centralized, I'd rather bid good bye to it. Bitcoin is decentralization. Bitcoin is decentralized or else it is not Bitcoin at all. It is just either a decentralized Bitcoin or nothing at all.

But other centralized apps, sites, payment systems, businesses, etc accepting Bitcoin does not mean Bitcoin is now stripped of its decentralized nature. It does not alter Bitcoin at all. Nothing has changed in Bitcoin.

Paypal is not the only way for decentralization supporters to buy, sell, and make use of their Bitcoin.

[XCANA]

For adoption sake we should embrace this once to see the effect. PayPal will act as an exchnage to enable the purchase of Bitcoin among it customers or in other word, they will give customers (clients) Bitcoin as an "I own you". Though, this might seem out of point but becasue of their huge number of clients around the world let drift a little to observe this moment of Bitcoin with PayPal Inc.

[pooya87]

it depends on "how" they enter.
we welcome anybody or any company that wants to adopt bitcoin as a currency. there are a lot of centralized companies that have done that (eg. Microsoft). there is nothing wrong with that, just like any individual a centralized "body" is also free to adopt bitcoin.
BUT when they come in and want to become something like a "bitcoin bank" by adopting bitcoin, then that is a big malicious move in my opinion. that is what PayPal seems to be trying to do. they want you to give up the freedom you gained by using bitcoin again and rely on them once more!

[Upgrade00]

Bitcoin has a couple of unique qualities which makes it stand out such as; decentralized, pseudo anonymous, immutable, transparent. If it was accessed using centralized platforms like PayPal, all of these qualities would be undermined:

• It would definitely become centralized as the platform would control the funds stored on them,
• There is a KYC process involved in setting up an account so users are not anonymous by any means,
• As it is centralized transactions can be blocked, reversed, and accounts can be frozen.

I would not call these small sacrifices as Bitcoin would be losing most of its core values. But, such Bitcoin adoption cannot be stopped and would keep happening even after PayPal, Bitcoin holders should ensure they do not use Bitcoin as a regulated currency.

[tranthidung]

To simplify things, I can tell you it is a two-sided partnership.

• Does PayPal need bitcoin? Does bitcoin need PayPal? Yes for 2 sides but at different periods, the level of importance for each side will be very different.
• Bitcoin
  
  • At least, now bitcoin needs PayPal to increase awareness on Bitcoin, expand adoption, get more capital flow into bitcoin from PayPal gates.
  • But without PayPal now, Bitcoin is still fine. The participation of PayPal is not a vital vitamin for Bitcoin survival
  • On the long run, the importance of PayPal will become less.
• PayPal
  
  • It needs Bitcoin for its income and for its future. Bitcoin, cryptocurrency and blockchain are the future of human civilization and digital payment methods, PayPal can not ignore Bitcoin (or crypto) and stay aside. They build up the gate for Bitcoin on their platform for their better income and for their future
  • They have own technical problems: scammers, chargebacks, and the method they built for Bitcoin transactions is not convenient and good enough in privacy, anonymity
  • In the future, PayPal will be beaten by Bitcoin and other new payment methods. It will more rely on Bitcoin for their income. It will be especially true when payments with blockchain-based payment methods become a new universal method.

[joniboini]

As far as they don't allow the users to withdraw the coins to their own wallet or if they don't give a key for the address I think it is dangerous. You probably don't buy any crypto at all and just a text called "Bitcoin" while the platform milk you from the fees (or as somebody mentioned above, a 'virtual bitcoin' that already exist on other platforms such as binary options). I'd never use a platform like that. It is not a problem of centralization or not, it is a problem if verification and making sure they don't rip you off.

[mk4]

It's a big sacrifice. Bitcoin is here to avoid centralization, it just doesn't make sense to welcome it this way.

Unpopular opinion: As long as we have the choice to hold our coins in a non-custodial manner, I really have not much problem with it. Unless the day comes that non-custodial services becomes as easy to use as custodial services, then custodial services will still be widely used. Because let's not kid ourselves, not everyone is tech savvy enough to do the things we do.

[hatshepsut93]

BUT when they come in and want to become something like a "bitcoin bank" by adopting bitcoin, then that is a big malicious move in my opinion. that is what PayPal seems to be trying to do. they want you to give up the freedom you gained by using bitcoin again and rely on them once more!

I don't think PayPal has a malicious intention of taking away the freedom of Bitcoin users, if they did, they would have been active in Bitcoin field years ago. They simply want to make money just like what they do with fiat. This doesn't mean that their service is good or safe to use, I just don't think there's any malicious intent behind it.

[CODE200]

BUT when they come in and want to become something like a "bitcoin bank" by adopting bitcoin, then that is a big malicious move in my opinion. that is what PayPal seems to be trying to do. they want you to give up the freedom you gained by using bitcoin again and rely on them once more!

I don't think PayPal has a malicious intention of taking away the freedom of Bitcoin users, if they did, they would have been active in Bitcoin field years ago. They simply want to make money just like what they do with fiat. This doesn't mean that their service is good or safe to use, I just don't think there's any malicious intent behind it.

If there's any intention that is no other than money, ofcourse. Bitcoin and other cryptos are having a widespread of popularity during the previous years and they might want to take the opportunity. This network will be some sort of a third party just like banks in fiat currencies. Centralization seems to be what would happen. But it somehow benefit this industry for putting cryptos in mainstream. More people would recognize this technology due to the influence this huge network is having. If Paypal would benefit from doing so, there is a chance that other companies and networks would do the same thing eventually. What we should look forward with, is the aftermath of such action.

[sheenshane]

I don't think PayPal has a malicious intention of taking away the freedom of Bitcoin users, if they did, they would have been active in Bitcoin field years ago. They simply want to make money just like what they do with fiat. This doesn't mean that their service is good or safe to use, I just don't think there's any malicious intent behind it.

I can't give more details of what the intention of PayPal upon embracing Bitcoin.  As I read in many articles, you can't transfer your Bitcoin and it should be on your PayPal account only.  So, what is the purpose of buying Bitcoin that you even don't have full control over your key?  Unless, if you trust this centralized company which is PayPal don't hold your crypto.  The only thing that has been benefited Bitcoin is just to have worldwide awareness that might possible to have mass adoption.

It's great news that PayPal opens their arms to cryptocurrencies at least, for them, it's a pure business because they know that Bitcoin was now on the mainstream.  There are too many ways to buy Bitcoin that you will own the keys, if you care about your privacy avoid PayPal this isn't for you.  We still are thankful, through PayPal, it has an impact on Bitcoin price and now pumped the price.

[Nalbo]

No one owns or have a full control over bitcoin. The freedom and the security provided by the extensive network is what makes bitcoin make popular.
People can have different views on bitcoin and with it's primary developer missing, they can define the objective of bitcoin to be anything.
For most, bitcoin has been a limited resource that's rare and is going to increase in price by folds, much faster than most other things. For them, any positive news are welcome. But who believe bitcoin as the leader of decentralization and power of peers, they'd believe bitcoin's going into wrong hands.

[Bttzed03]

Expectation:
1. People will realize the importance of a currency that's not controlled by the Government.
2. People will understand how fuck up fiats are - how it's not really backed up by Gold and how Central banks prints them so easily.

Reality:
1. Most people don't give a fuck whether what they're using as currency is just a piece of paper with no real value.
2. The convenience centralized platforms provides is more important than the value of decentralization.

To be frank, part of the blame why BTC isn't going mainstream without these centralized platforms like Paypal is on us. How many of us have truly supported P2P marketplaces and exchanges? How many of us blames the developers for not giving us the same experience as Paypal, Amazon, Binance etc.?

[ChrisPop]

I think we shoud look at the centralized entities adopting Bitcoin like a mainstream. Before we go into full decentralization people need to feel "safe" about Bitcoin. Big names like PayPal putting their reputation on the line by offering crypto-related services like payments and asset holding features is certainly an assurance for users.

[cabron]

Whatever development is a good development. I think centralization had gradually started since the CEX accumulating our KYC data and this paypal not just accepting BTC but also acquiring CEX will collect more data from not BTC users to the ones who started using. It helps bitcoin to be well known though and whether we welcome them or not, its not up to us because all these are opensource.  There really is the need to use DEX because they are up to chase those DEX users, the government is catching up with the dex users.

[kryptqnick]

I'm closer to welcoming such steps than being outraged by them. I don't like Facebook's Libra project and would not welcome such a huge privacy risk and this company getting even more powerful. That's too much, and it barely counts as crypto adoption. I also hate big US banks that both invest in cryptos and say bad things about Bitcoin. In general, I wouldn't feel comfortable with their projects. But companies that are adopting Bitcoin and allowing people to use it more are good for crypto adoption. I get it, they're centralized, don't care about privacy and are profit-oriented. But if with their help Bitcoin becomes more accessible and usable, it's worth a shot.

[bL4nkcode]

Any adoption from any kind of company is good and nothing to worry about for the centralization issue, but I'm not good with existing digital payments acting as a wallet/exchange that doesn't let its users send bitcoin/crypto to others.
 

[bitbunnny]

If we want to see better adoption of Bitcoin and further development regulation and some kind of monitoring are needed. I wouldn't say that would automatically mean centralisation but from my point of view it would mean better protection and security as well as legal certainty, especially for companies.