Crypto currency takes bashing from Paypal
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Crypto currency takes bashing from Paypal

Dan Schulman, Chief Executive Officer of digital payment company PayPal, has spoken this week about the rise in investment in crypto-currencies that has been seen in the last part of 2017 and the early part of 2018. Bitcoin was valued at around $1000 a coin at the beginning on 2017, by it’s end it had reached $14800.00 per coin.

In reference to the large swings seen in the value of Bitcoin he had this to say: “because retailers have very narrow margins, and when you have a bitcoin bouncing up and down by 15 percent over a couple weeks period, that can be the difference between profits and losing money on every sale”.

In an interview with TheStreet.com the CEO said that it is because of this volatility that Paypal’s focus on innovating in the payment market has not focused specifically on Bitcoin, a crypto-currency based on a distributed trust network and the solving by computer of a hash. (A hash is a cryptographic algorithm that’s output is repeatable but not reversible for Bitcoin this is SHA256 and produces a 256 character long hash.)

However he did go on to say that blockchain technology, the basis on which Bitcoins hashes are generated, are a “real breakthrough” that Paypal has a lot of room to innovate with. “I think you need to separate out the bitcoin or cryptocurrencies as currencies and the underlying protocol called blockchain,” he said.

Paypal is not the only company to speak out against Bitcoin recent months with Jamie Morgan, Chief Executive of JPMorgan Chase calling the crypto-currency a fraud and saying he would fire any trader he found trading in it. Meanwhile China and South Korea have both banned Bitcoin transactions and initial coin offerings altogether.

Disclosure

Dominion holds Paypal in its Global Trends Ecommerce Fund.


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