Paypal seems to be missing a trick. One that Skrill is winning!
“Given the volatility of bitcoin right now, it’s not a reliable currency for transactions because if you’re a merchant and you have a 10% profit margin, and you accept bitcoin, and the very next day bitcoin drops 15%, you are now underwater on that transaction, The technology, there is real merit to it. I do think, though, it will be years down the road before we see the kind of ubiquity and acceptance that make it a form of currency that is used every day.”
Now, what are they worried about? Well basically this, someone tops up their Paypal with Bitcoin, but DURING the transaction Bitcoin drops 25%. So in fact, although the person’s transaction started with say £100 worth of Bitcoin it’s now only worth £75.
So where is he going wrong?
Firstly, you just need to hold the cryptocurrency – it will go back up ALL MARKETS FLUCTUATE even things like the DOW and the NASDAQ have recently dropped a thousand pips in one go. You mitigate this by simply holding a basket of currencies, this balances the risk, so currencies that go up are covering that is going down – it’s no different with cryptocurrency which is why I recommend people have a basket of currencies in their portfolio.
Paypal, to be honest, are over zealous with protection. I like Skrill because they provide a debit card (even to people in the UK), take Bitcoin and are very efficient and less likely to hold your money.
It’s amazing how an organisation that has spent so many years making a fortune out of moving peoples money around misses the one thing that could secure their future.
I note with interest that Coinbase has got an ex-PayPal chairman on the board.