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Isn't PayPal effectively a cryptocurrency?
jmlanzaf
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Or do you need to be using blockchain technology?
At the very least, doesn't PayPal create virtually all the advantages of cryptos: Money within the PayPal ecosystem moves from person to person electronically with no government or bank intermediary. PayPal has layers of encryption, it just doesn't use the encryption itself to justify exchanges. It's only removal from the ecosystem that requires exchange via bank or governmental currency. Bitcoin functions largely the same way.
The only real difference is that bitcoin uses a distributed ledger via blockchain technology. But, what does that really buy for me?
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yes, I guess so.
never thought about it
BHNC #203
PayPal isn’t a currency, it is a transaction platform. Is Visa a currency?
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Paypal covers you. They just covered me again for the upteenth time last night. PayPal has never not covered me.
I think the definition of crypto-currency implies that you and I could exchange them on a street corner, (or via email), without interaction with some third party(?)
In that sense, PayPal, credit cards, Google Pay, hand written checks, etc., don't REALLY qualify as crypto-currency.
Cash is the ultimate privacy option; politicians have been trying to abolish that. More IRS audits would address some concerns but those are rare. Paypal customers for years were able to avoid taxes if they were careful.
Yes. Crypto can and does serve the same purpose as PayPal, apple pay, venmo, etc. but is very different. There are many positives to using cryptocurrencies over electronic transaction platforms.
Exactly...can't trade or profit by selling/buying "a PayPal"
I always thought a 'crypto' transaction is an anonymous thing. There is no connection to you personally when a transaction occurs. Unlike Paypal or a credit card which produces a record that will last for all time......
crypto involves block chain technology. Paypal is a digital payment processor as is Visa.
Give Me Liberty or Give Me Debt
No. It's an unnecessary parasite that extracts money from participants. See "leach" and "blood sucker."
Why are you having so many problems? I have had only a single chargeback (Paypal covered it) in over 15 years.
Actually I have probably about ten in 19 years. My auctions get a lot of bids thus a lot of interest. Maybe scammers are looking at ending coins and look for the items with lots of bids.
This has been debated at the Fed and other regulators for years. Officially Paypal does not create money, it is a transmission mechanism. However, when it first started, it gave new customers $5 in virtual currency (a credit) which never existed prior and could have run it afoul of the law. A new start-up clone of Paypal, that operated exactly as it did, would be shut down in about a week for violation of money-transmitter laws.
As a few others have said, I think that the difference is that with paypal you are sending and receiving US dollars which are backed by the US government and you can withdraw your funds at any time and have a check which you can cash for cash. You aren't sending and receiving TotallyCoins. With TotallyCoins, first you have to sell your TotallyCoins for US Dollars, then you have to withdraw your funds and you get a check which you can cash for cash. TotallyCoins are financially backed by the hot air coming out of my rear end, US Dollars are backed by the US government. I can use US Dollars to pay my taxes, but I can't use TotallyCoins.
Successful transactions with: wondercoin, Tetromibi, PerryHall, PlatinumDuck, JohnMaben/Pegasus Coin & Jewelry, CoinFlip, and coinlieutenant.
Paypal is a conduit for currency.
But the inventor is a genius.
Elon Musk
Might as well invest in Beanie Babies as compared to BitCoin.
No. The 'crypto' currency, BitCoin at least, keep a permanent record of every transaction forever. In fact, this permanent ledger is visible to the whole world, and will be forever. That is that 'blockchain' stuff. Crypto is the least anonymous of all possible currencies. At least for a PayPal or CC transaction, somebody has to get permission to look at the ledger, but with BitCoin, it is open for all to see.
Thats not exactly correct. The blockchain is visible and will last forever. But, the people on both ends are extremely hard to trace. Especially if they intend on their purchases been untraceable. Bitcoin addresses don't have a name assigned to them so if you don't use a traceable form of payment (i.e. credit card) to purchase bitcoin, no one will be able to determine who you are even though the transaction is visible.
No, Paypal is a virtual bank account that has a line of credit settled by other accounts (cc or bank accounts) with service fees for what it does.
But I can't heat my house mining for paypal.
Give Me Liberty or Give Me Debt
cryptocurrency means you can't understand it
I understand paypal
There appears to be a big push for Bitcoin and more than likely by those that are heavily invested in bitcoin.
To me, I've always viewed bitcoin as a dead end since it has no government backing. It's a made Pyramid Scheme that could cost folks a lot of money.
The name is LEE!
PayPal is NOT a bank account. That's why they've managed to avoid all the wire transfer laws that other banks are forced to abide by.
And, for that matter, bitcoin is a "medium of exchange" that can be converted (via bank accounts or credit card) into other currencies with service fees for what it does.
That's actually NOT the definition of cryptocurrency.
https://www.investopedia.com/terms/c/cryptocurrency.asp
Cryptocurrencies are defined by their use of encryption to mediate transfers. That is NOT what PayPal does, admittedly. But the central justification for cryptocurrencies is their independence form central authorities. Within the PayPal ecosystem, you have exactly the same thing going on.
To that end, why isn't PayPal the "King of Cryptocurrencies"?
I don't think the answer, either way, is as definitive as you want to make it.
Define currency. Bitcoin isn't a currency either as almost no transactions are done using it. Bitcoin use is mostly done after conversion to dollars.
If PayPal calls your PayPal balance "PayPs" instead of dollars, it is then a currency at parity with the dollar. You transfer $100 into PayPal, get 100 PayPs. YOu then exchange those 100 PayPs with vendors and each other for goods and services.
Effectively, money moved within the PayPal ecosystem functions like a currency at parity with the $.
Visa could do the same thing - and maybe should if cryptos are so popular - although they don't generally keep the money within the Visa ecosystem, it almost immediately ends up in a bank. That is different from PayPal.
Actually, you and I can exchange PayPal on a street corner. And there is a third party interaction for bitcoin involving the bitcoin network itself. The PayPal transaction justification is simply orders of magnitude more efficient than bitcoin which requires Teraflops of computation rather than simple password verification.
Is that good or bad?
And if Bitcoin is so open, why is it the currency of choice for money laundering?
That doesn't really draw a distinction, does it? It just makes PayPal more efficient. Consider:
I use a cc/bank account to put $100 into my PayPal account. I send this $100 to other PayPal users. Those PayPal users eventually transfer it back to their bank account.
I use a cc/bank account to buy $100 in TotallyCoins. I send this $100 worth of TotallyCoins to other TotallyCoin users. Those TotallyCoin users eventually tranfer it back to US$100 in their bank account.
What's the difference? Only the way the transaction verification is done.
True. NY State and a few other states went after PayPal at one time trying to label them as a bank. In fact, I actually extorted a settlement from PayPal on a transaction that went awry by threatening them with the NY State Attorney General.
PayPal was brilliant. By not being a bank, they and they alone could transfer money with almost no transaction costs. Banks could not, for years, because of wire transfer laws which PayPal evaded.
That said, aren't the cryptocurrencies exploiting a similar loophole. After all, Bitcoin is (currently) exchangeable for dollars and most of the current action in bitcoin is dollar conversion. [Used to be mining which was more of a currency creation mechanism, although even then it was largely trading electricity bills in US$ for bitcoin.] What would the value of bitcoin be if it becomes unexchangeable? My guess is zero.
Other cryptos are tied to hard assets. Those, in theory, would have value even without exchangeability. But that's speculative.
Ultimately, I think the crypto craze should lead us to think more openly about what a currency is, what a bank is, etc. And, sociologically, we should consider what is driving the desire for the cryptos.
What is the advantage of a non-governmental currency? Is there one? People mock "fiat currency", but at least my fiat currency is potentially backed by an army of regulators, not to mention an actual army. Bitcoin is far more fiat than dollars. Yet, there is some anarchic appeal that has led to the craze. [The craze is currently sustained by chasing the rising price, but it didn't start that way.]
No it’s a federal regulated deposit acct based on actual funds. It has no market fluctuation. paypal requires Anti money laundering policy to be in place and sends tax statements. Will Crypo send you a tax statement? Bitcoin is a data mining system for Terrorist.
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Some people seem to think so.
Both Visa and MC have prepaid products that have to be funded in advance, funding mechanisms for those accounts could put them in the same positions as this other stuff.
I'm not advocating for bitcoin. Quite the contrary, I'm arguing that PayPal fulfills the market niche that bitcoin purports to be trying to fill.
"Market fluctuation" alone isn't indicative of anything, by the way. The Euro fluctuates by the minute. On the flip side, you can peg your currency to the dollar if you want and then your currency doesn't fluctuate. So, you could call PayPs a pegged currency.
Agreed. And if I'm Visa or MC...or frankly, Amazon, Apple, Microsoft, or Walmart...I might consider creating my own $&*(#currency (crypto or not). A more liquid form of Disney Dollars. There appears to be a market niche here. If floated by someone less nebulous and mysterious than the unknown founder of bitcoin, it might have actual traction in commerce.
Of course, those companies may not want to risk federal regulators stepping in and limiting convertibility...the step that will ultimately crash bitcoin and the like.
The bitcoin saga (and all cryptocurrencies) is interesting.... some will get rich, many will lose.... the endgame, though not in sight, is predictable. It likely will evolve into a black market exchange platform.... after a tumultuous journey through governmental and financial storms. Cheers, RickO
It scares me to think how many people here have absolutely no clue about what a currency actually is.
Latin American Collection
Agree. We have seen the rise & fall of this three times now. I have watched it since prior to 9/11. Its not for me. But your money do as you please.
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Well, that's because even the US government isn't too sure about it either.
If I pay you in sea shells and hide them under the fourth rock from the big sand dune and then send a messenger to your house with the location of your new sea shells and you go dig them up. . .
Paypal is not a crypto currency because the medium of exchange remains in dollars. One is not first buying paybits and then having to convert them back to dollars. Again, while conducted in the digital realm, PP is strictly a payment processor of dollars as is Visa. The only real difference in PP and Visa is that PP usage fees are collected at the time of the transaction with no debt incurred.
Give Me Liberty or Give Me Debt
My point is that money in the PayPal system need not be considered dollars at all. It could be called PayPs and pegged to the dollar and then it is effectively a separate, exchangeable currency. In that context, you get all the advantages of a cryptocurrency without all the downside. IMHO.
Silliness is not the sole element in cryptocurrencies.
I'm more concerned at the number of people here who seem to have a 19th century construct of what a "currency" is.
Consider good old American Express Traveler's cheques. They were a medium of exchange, denominated in dollars. You could argue they were a separate form of currency that could only be used within the AmEx ecosystem.
PayPal is similar. Not everyone needs to accept PayPal. But everyone in the PayPal ecosystem de facto accepts PayPal transfers. In some sense, that makes PayPal a currency realm separate from the dollar realm.
And again, if they simply called PayPal deposits "PayPs", even though pegged to the dollar it would be a separate currency. [With all corresponding advantages and disadvantages that go with that - EXACTLY LIKE cryptocurrencies.]
Actually, the construct has evolved since the 18th century - unlike some of the narrower thinking around here. No gold no money?
It already is a black market exchange platform.
I'm not sure what, other than distrust of the government, is the driving force for cryptocurrencies. It certainly isn't price stability, in some cases by design. They have made bitcoins, for example, harder and harder to acquire rewarding the top of they pyramid scheme at the expense of the bottom of the pyramid.
When I think of cryptocurrencies, I automatically think of blockchain and relative anonymity. I associate neither with PayPal.
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I know this is OT. But had to reaffirm this is very true @jmlanzaf.
Most do know what the black market means on the web.
@Hemispherical ...You are thinking of the 'dark web'... The black market is exchange of illegal goods or exchange without taxes etc. Cheers, RickO
I agree. And that is where the “weird” stuff of the BM is... ••• - - - •••