Paypal to Accept Bitcoin Soon

Earlier today, David Marcus (The current President of Paypal) tweeted:

To clarify: we have no policies against using PayPal to sell Bitcoin mining rigs. We don’t support any currency txn whether fiat or BTC…

…for a host of regulatory issues. But we treat BTC and any FX txn the same way. We’re believers in BTC though.

Now, when we here at CCN first reported on this happenstance, we were emphasizing David Marcus stating that Paypal is a believer in Bitcoin.  I want to take a quick second later to dictate exactly what Paypal being a believer in Bitcoin means (hint, don’t get your hopes up).

Yesterday, a redditor posted a picture of an email that he had received from Paypal support’s international team.  This post understandably made it to the front of /r/Bitcoin and clearly garnered a lot of publicity.  Within 24 hours, it seems that Paypal got back to the same redditor with an updated email.  This was followed by the afore-mentioned tweets from Paypal’s President himself.

Initially, Paypal’s stance had been that selling of Bitcoin or Litecoin mining ASICs, or machines in general, was in violation of their Terms of Service.  Many cynical onlookers have wondered if this meant that Paypal was banning the sale of video cards or multi-use FPGAs.

Only after threatened legal action and facing incredibly negative publicity on Reddit, did Paypal (their President no less) respond adequately.  They have clarified their Terms of Service that Bitcoin mining ASICs are actually allowed to be sold via Paypal, and by extension eBay.  However, Bitcoin sales, the same as Euro sales, are disallowed by Paypal.  Hopefully those with accounts frozen by Paypal due to ASIC traffic will soon have favorable rulings.

A key point here is that David Marcus himself, or an aide/intern/secretary, is actually a normal frequenter of Reddit, and more specifically /r/Bitcoin.  This actually isn’t surprising given the number of revealed “celebrity” lurkers on Reddit; furthermore, it is even less surprising given Mr. Marcus’s belief in the longevity of Bitcoin.  Redditors really need to be aware that the world is watching…

Onto Paypal’s future use of Bitcoin.

Currently, Paypal has a list of 69 countries that are banned from Paypal’s payment network, as well as several countries that are own their own distinct payment network.  The reason for this is the high risk of internet fraud from these locations, which manifests in lack of Visa/Mastercard support as well as generally less trustworthy banks and financial systems.

Paypal’s future use of Bitcoin will be deposit only, at least in the beginning.

Furthermore, it will be targeted at including these high-risk areas.  As every reader should know, Bitcoin coming from my friend Sergei in Uzbekistan is just as good as Bitcoin coming from my Coinbase wallet to any Bitcoin-accepting merchant (Ranks that Paypal might join soon).  The same cannot be said for our respective credit card information.

That being said, Paypal’s use of Bitcoin for secure and fraud-free deposits from high-risk geographical regions will highlight Bitcoin’s superiority as a medium of exchange.  It is not in any way shape or form the full Paypal implementation of Bitcoin that we all want; however, it will benefit Bitcoin and it will come sooner than you think.