Payment Service providers, Paypal Inc. has filed a patent application for a system that aims to speed up cryptocurrency transactions.
The application released by the United States Trade and Patents Office (USTPO) on March 1, describes an “expedited virtual currency transaction system.” According to the application, Paypal’s new system will involve creating secondary wallets that will have unique wallet private keys. To make a transaction, predefined amounts are first transferred from the primary wallet to the secondary wallet and then a private key to the secondary wallet is sent to the receiving end of the transaction.
Part of the application which was originally submitted in August 2016 read:
“The systems and methods of the present disclosure practically eliminate the amount of time the payee must wait to be sure they will receive a virtual currency payment in a virtual currency transaction by transferring to the payee private keys that are included in virtual currency wallets that are associated with predefined amounts of virtual currency that equal a payment amount identified in the virtual currency transaction.”
PayPal in the application explained that this system will reduce the delay normally experienced before a cryptocurrency transaction is confirmed in a new block. The application cited the 10minutes delay when transacting on the bitcoin blockchain as adversely affecting customer experience. This delay PayPal believes is a disadvantage that has hindered the mainstream adoption of virtual currencies despite their benefits. There is, therefore, a need for an expedited virtual currency transaction system.
Cryptocurrency and Blockchain Technology are seen as promising emerging technologies and as such have been receiving interest from companies seeking to lead the way. The result has been an increased number of blockchain and crypto-related patents.
PayPal is not new to cryptocurrency innovations. As early as 2014, the payment giants announced a partnership with Coinbase, Bitpay, and GoCoin in a partnership that allowed them to accept Bitcoin. In 2016, USTPO released a patent application by PayPal for a Cryptocurrency Payment Device to process cryptos like Bitcoin, Litecoin, and Dogecoin.