PayPal CEO: Financial System Will Change More in Five Years Than Past 20

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In Brief
  • PayPal CEO says the onset of the coronavirus pandemic drastically accelerated the development of digital payments.

  • As cash usage declines, this will force central banks to issue digital currencies (CBDCs).

  • After six years of consideration, Schulman says demand for crypto has exceeded expectations.

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PayPal CEO Dan Schulman says the onset of the coronavirus pandemic drastically accelerated the development of digital payments. 



Schulman highlighted that digital payments haven’t advanced only by means of online commerce. Although this has certainly been boosted by the COVID-19 pandemic, even in-store shopping has become increasingly digitized. “Nobody wanted to touch cash,” Schulman said, “and that led to a large increase in the use of digital forms.”

Consequently, the PayPal CEO anticipates, “ten years from now, you will see a tremendous decline in the use of cash. ”He predicts that even card use will fall out of favor and most payments will be done on phones through “six-to-10 super apps.” As this happens, Schulman expects that central banks will have to rethink monetary policy.



“In the next five to 10 years, you’re going to see more change in the financial system than you have over the past 10 to 20 years,” Schulman prophesied. 

Schulman on CBDCs

Because the financial system will develop so radically, Schulman believes it will behoove central banks to issue digital currencies. He says they may utilize distributed ledger technology, “ but they’re basically digitizing a fiat currency.” For instance, in the United States, a digital dollar would be fully backed by the US government. 

For Schulman, this digitization could enable the Fed to fund other institutions besides banks, even potentially PayPal. “You wouldn’t have to send out stimulus checks in the mail,” Schulman says, “just go directly into their digital wallet through a digital currency, instantaneous access, no cost and friction.

Digital currency adoption

Further adoption of digital currencies would likely be a boon to PayPal. Besides seeing an increase in usage due to the pandemic, the firm has also helped to popularize the use of cryptocurrencies.

The PayPal CEO admitted that the company had been looking into cryptocurrencies for the past six years. During that period, he thought of them more as assets than currency. They were also too volatile to act as currency, he says. Schulman asserts that cryptocurrencies need to be understood better in order to collaborate with regulators before releasing and products.

It was only a few weeks ago that PayPal released “Checkout with Crypto.” This enabled U.S. customers to make payments with bitcoin (BTC), ether (ETH), Bitcoin Cash (BCH), and Litecoin (LTC). Just last week, PayPal’s Venmo payment app launched “Crypto on Venmo.” Users can now buy, sell and hold cryptocurrencies on their Venmo app.

“Demand on the crypto side has been multiple-fold to what we initially expected,” Schulman said. “There’s a lot of excitement.”


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Nick is a data scientist who teaches economics and communication in Budapest, Hungary, where he received a BA in Political Science and Economics and an MSc in Business Analytics from CEU. He has been writing about cryptocurrency and blockchain technology since 2018, and is intrigued by its potential economic and political usage. He can best be described as an optimistic center-left skeptic.

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