PayPal Holdings, Inc PYPL CEO Daniel Schulman said at the company’s third-quarter earnings call Monday that its cryptocurrency foray is "just the beginning of the opportunities."
What Happened: Schulman said PayPal is creating “one of the most compelling and expansive” digital wallets in the world — terming digital wallets as a “natural complement to all forms of digital currencies.”
The executive said that the digitization of the global economy along with the rise of the digital wallet will drive PayPal’s growth over the next decade.
The Peter Thiel-co-founded company also plans to allow consumers to use cryptocurrencies as a “funding instrument” to shop across 28 million merchants on the platform.
“This solution will not involve any additional integrations, volatility risk, or incremental transaction fees for either consumers or merchants and will fundamentally bolster the utility of cryptocurrencies,” said Schulman.
Schulman said it was just the “beginning of the opportunities” as the company will strive to work “hand in hand with regulators to accept new forms of digital currencies.”
The executive said that while the use of cash continues to decline, central banks around the world are exploring or trialing new forms of retail digital currencies.
“These trends create an opportunity for us to work with central banks and regulators to shape a modern and inclusive financial system,” said Schulman.
Why It Matters: PayPal will add cryptocurrency services to its Venmo app by the first half of 2021 and also allow international users to buy, sell, and hold cryptocurrency by the same time period.
While some have welcomed PayPal’s foray into Bitcoin and other cryptocurrencies, others have questioned the limited nature of the services it will provide.
The San Jose, California-based financial giant is said to be in talks to acquire digital asset custodian BitGo, according to Bloomberg.
PayPal’s third-quarter earnings per share rose 75.41% year-on-year to $1.07 beating estimate of $0.94.
Price Action: PayPal shares traded almost 5.7% lower at $177 in the after-hours session on Monday after closing 0.9% higher at $187.76.
Photo courtesy: PayPal
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