In a recent interview, PayPal CEO Dan Schulman spoke about the real reason PayPal withdrew from Facebook’s Libra project and revealed that he does, indeed, own Bitcoin.
Speaking with Fortune’s Polina Marinova on Wednesday, Shulman admitted that not only did he own Bitcoin, but that it was the only cryptocurrency he currently holds.
Deftly sidestepping a question about CFO John Rainey’s comments earlier this year about crypto and blockchain projects in development at PayPal, Shulman said that the company is definitely interested in blockchain technology, but more for what can be built on top of it, rather than blockchain itself.
“It’s intriguing to us, but it really needs to do something that the traditional rails can’t do. Most people think that blockchain is about efficiency, but the system today is pretty efficient,” he said.
“It’s about the applications on top of it, not necessarily using it to lower the cost by one-eighth of one-eighth of a fraction. By the way, if it does turn out to be a lower-cost infrastructure, all of us will move to it.”
PayPal saying ‘no’ to crypto – for now
As far as any cryptocurrency-related services, it doesn’t look like PayPal will be rolling those out any time soon.
Shulman explained that there simply hasn’t been much demand from merchants, largely due to cryptocurrencies‘ volatility and the fees that would be incurred in exchanging crypto for fiat currency.
“It’s still very volatile, and therefore, we don’t have much demand for it by merchants because merchants operate on very small margins,” he said.
“And what they have to do is immediately turn it into fiat, and there’s a fee for turning it into fiat, so any advantage in cost is typically eaten up by that conversion fee.”
“Until it becomes less volatile, it won’t be a currency that is widely accepted by merchants on the web — not the dark web, but the web.”
On PayPal quitting Libra
Since Facebook first released Libra’s whitepaper in June, the project has been under siege from regulators around the world over concerns that it would disrupt global financial stability.
Opposition to the project was – and is – so great that some US lawmakers sent ominous letters to Libra Association members, warning them that they could “expect a high level of scrutiny from regulators” if they remained involved in the project.
In an email sent to TechCrunch, PayPal explained that the decision was made to “continue to focus on advancing our existing mission and business priorities as we strive to democratize access to financial services for underserved populations.”
The company added that it remains “supportive of Libra’s aspirations and look forward to continued dialogue on ways to work together in the future.”
During the interview, the PayPal CEO also discussed the company’s withdrawal from Libra, the reason behind it, and the company’s engagement in the cryptocurrency industry.
When asked if PayPal had decided to pull out of the association due to the regulatory issues that Libra had been facing, Schulman said:
“Regulatory and compliance, for us, is foundational,” and that the decision was about “Where do we want to put our attention, and what do we want to do today to advance our mission?”
Denying any bitterness over the company’s decision to withdraw, Schulman clarified that PayPal was eager to learn about what Libra had to offer and how it could help them “do things more efficiently.”
Stating Libra’s slow-paced progress as a pretext to their decision, Schulman explained:
“As we learned more about [Libra] and saw the amount of things that were still left to do and the amount of things we still had to do on our own roadmap outside of Libra, we said, ‘You know, we think if we focus on our own roadmap, we’d be able to advance financial inclusion faster than if we put all these resources against Libra.'”