As the cryptocurrency market falls apart, investors and startups are jumping ship. Recently, smartereum.com reported that some blockchain startups are going bankrupt and have no means of raising capital amid this bear market. This includes the company behind Ethereum Classic – ETCDEV. Well, not everyone is leaving the industry. Some big time financial giants are making large investments in cryptocurrencies. The latest giant in the financial space to show an interest in the industry is PayPal.
PayPal And Blockchain Technology
PayPal recently announced the release of a private token that allows its employees to enjoy incentives. The internal blockchain allows staff to exchange and trade tokens while participating in programs and making contributions to the development of the company. The initiative was built around twenty five people and would last for six months.
For this project, the company has set up a website only accessible to its staff. They will access their private coins and earn money through the website by enrolling in any of the available learning programs. The tokens are only tradable within the system. Staff would be unable to use them outside the blockchain.
From Anti-Crypto to Pro-Crypto?
Right from time, PayPal has been anti-crypto. It refused to accept any integration of cryptocurrencies on its marchant platform because of the high volatility that plagues the industry. This is understandable because PayPal will especially suffer losses due to price volatility as transactions on the platform take a lot of time to complete. The fact that PayPal has introduced a private blockchain doesn’t mean that it is going to integrate the technology commercially. What it means is that it is wants to make its staff familiar with the concept. The company didn’t say anything about adopting the use of public cryptocurrencies.
Bitcoin (BTC) Price Today – BTC / USD
Employees who want to cash in their tokens will be able to do so by participating in martial arts tournaments, poker tournaments, running tournaments, etc. Winners will earn tokens accordingly. One of the senior executives at PayPal said:
“People who are into Venmo can see our activity logs, as well as comment and like innovations related to PayPal.”
What The Future Holds
Even if PayPal has introduced a private blockchain to its network, the chances of venturing into the industry fully anytime soon are slim. In 2017 alone, PayPal made $13 billion in profit. A chunk of its profit was generated because of the high inflation of exchange rates. PayPal charges up to 5% for sending money from one PayPal account in this country to another PayPal account in another country. This makes cryptocurrencies a threat to the company’s business. Sending money via blockchain is cheaper and faster.
Notwithstanding, the fact the company has made a move within the space shows that it is interested in blockchain technology. If at all the company decides to publicly join the industry, it will most likely develop a PayPal token that will be redeemable and used to facilitate transactions on the platform.
Not too long ago, Coinbase announced that it would be allowing some users withdraw cryptocurrencies through PayPal. However, this process would require that a user adheres to the KYC policies. This, in turn, eliminates the advantages of PayPal. It would be like using a regular bank.