HN Theater @HNTheaterMonth

⬐ tonez

The main line: "So I've been spending a lot of time looking at it. It's truly fascinating, actually, the way the currency's been designed and the way inflation is built-in to pay for miners and all that, it's truly fascinating. And I think, for us at PayPapl, it's just a question of whether Bitcoin will make its way to PayPal's funding instrument or not, and we're kind of thinking about it right now."

⬐ lingben

inflation? I think he means DEflation

⬐ drcode

Bitcoin has inflation in the short term but deflation in the long term. Right now more bitcoins are still being generated, so I think the term "inflation" makes sense.

⬐ tonez

In the context of mining, I think what he really meant is neither inflation nor deflation, but rather issuance. (http://en.wikipedia.org/wiki/Central_bank#Currency_issuance)

⬐ jcampbell1

He used an imprecise word. He meant something like "supply increase". Both inflation and deflation are incorrect because both require speculative opinions, and he was referring to the way the total number of bitcoins outstanding increases over time, which is a fact.

⬐ tlrobinson

The price relative to other currencies deflates as long as demand rises. The total number of Bitcoins inflates (at a decreasing rate) for the next 100+ years.

⬐ etherael

Not for the next 127 years.

⬐ andylei

limited supply of bitcoin means that the value of bitcoin will probably inflate. equivalently, prices of goods and assets denominated in bitcoin will probably deflate.

⬐ mckoss

In 8 years (by 2021) 90% of Bitcoins will have been issued. Strictly speaking, the supply is inflating continuously, though it is unlikely to ever be growing faster than future demand (we seem to have past that point within the last year). The only reason economists would call Bitcoin deflationary is the presumption of constantly growing demand.

⬐ BadCRC

> Strictly speaking, the supply is inflating continuously

what about Bitcoins being lost? perhaps we should also consider coins that are not used in the past five years also "lost".

⬐ _ikke_

Even if you mark them 'lost', you can't just trivially reassign them. You would need to have the private key to be able to spend them, there is no other way.

⬐ chimeracoder

This is known as seigniorage: http://en.wikipedia.org/wiki/Seigniorage

Interestingly, though, while (some) seigniorage is a good thing for a debt-based like the dollar, it's a bad thing for Bitcoin.

⬐ fnordfnordfnord

>what about Bitcoins being lost?

At some point, the rate of loss may overtake the rate of new coin creation.

> perhaps we should also consider coins that are not used in the past five years also "lost".

Maybe, but be prepared for some of those to someday be spent, they may merely have been hoarded. I have dollars that have been in my possession for more than five years, they aren't lost as far as I am concerned.

⬐ lolcraft

Eh, not really. Economists would call a currency deflationary if it causes deflation, that is, if it inflates slower than demand does. Bitcoin is massively deflationary, and only inflating in a very pedantic sense.

I think assuming that Bitcoin will be (for practical purposes) eternally deflationary is the safest bet that could be made today. The world economy has been growing by triple digits every century. Not even now we're nowhere near a global Star Trek post-scarcity future. So it's misleading to say that Bitcoin is deflationary "based only on a presumption". Somewhat like saying that physics is just "based on the presumption of Newton's laws".

⬐ codeulike

Does the divisibility of bitcoin make any difference? If they changed the protocol now and then so that the number of decimal places (currently 8) increased to 9, then 10, etc, would that be viewed as increasing the supply of bitcoins?

⬐ cecilpl

If the US government started minting 0.1 cent coins and 0.01 cent coins, would that be viewed as increasing the supply of dollars?

⬐ codeulike

If the USD was deflationary, then maybe it would?

⬐ jontaylor

In Bitcoin the supply and availability of currency are decoupled. By funging or splitting a unit of Bitcoin currency into pieces you increase the availability for use while preserving the value of everyones holdings. Based on the supply and demand the price will fluctuate independently of supply levels.

My understanding is that regardless of how inflationary or deflationary Bitcoin is, there will be no effect on the availability for anyone to buy and sell.

⬐ jellicle

If Zimbabwe adding extra zeros before the decimal point to its money doesn't cure inflation, then Bitcoin adding extra zeros after the decimal point won't cure deflation.

⬐ codeulike

Zimbabwe was very different: the amount of money people had was devalued by new notes being printed that had extra zeroes before the decimal point.

Adding extra zeroes after the decimal point for money already in circulation leaves the total supply the 'same' but could also be viewed as increasing supply 10-fold, without disadvantaging anyone currently holding the currency.

Its never happened before, so I'm not sure many economists have thought about it

⬐ chipsy

Changing denominators has an effect on the liquidity of small transactions, but it's not going to change inflation.

What inflation does in an economic sense is much bigger - it changes who has relatively more or less wealth or debt over time. If you take out a loan for $10,000 and inflation makes both your prices and wages go up 2x, then you now have half as much debt.

Deflation does the opposite and makes debt more and more expensive. This is why most economists are against it - debts that grow more expensive will trap people. Historically, debts were forgiven by decree (a jubilee) because the system kept breaking.

⬐ jontaylor

To me this is one of the most interesting things about Bitcoin. It is an asset based currency. In a debt based fractional reserve dollar economy you or someone else owes that currency back with interest. The economy is like a game of musical chairs. If a society was based on something like Bitcoin everyone could have assets, there wouldn't be as a strong need to borrow as there is today.

If Bitcoin was a predominant part of an economy borrowing a loan in it could be very bad. In a predominantly Bitcoin based economy everyone could have abundant wealth and there would be no need to be a debt slave.

⬐ jontaylor

Inflation killed the Zimbabwe currency because delusion caused it to become worthless not because of availability or velocity issues that people are worried about in Bitcoin. These are two separate issues that people always seem to talk past each other on the subject of Bitcoin deflation. Splitting a Bitcoin into smaller units allows for unrestricted availability and velocity. Anyone can always buy and sell at market rates to complete a transaction. Inflation or Deflation of the currency has no effect on its availability. So why is it bad if it is deflationary?

⬐ vlasta2

Oh, dear. If I were the president of PayPal and wanted to make quick buck, I would buy some bitcoins, released news like this, and sold my bitcoins the next day with a nice profit. And then, I could just deny the news, sending bitcoin value back where it was so that it is ready for the next exploiter... Heh.

But seriously, PayPal and Bitcoin are by nature rivals. If PayPal wanted to have a crypto-currency, it would develop its own, not validate and boost value of another one gaining nothing in the process.

⬐ milesskorpen

David Marcus makes ~$1.5-2M / year, and has $11M+ in stock options, plus whatever he made from selling his last startup (Zong). I really don't think he needs to worry about gaming the bitcoin ecosystem.

Also: Developing a new currency is hard, and inherently antagonistic with other governments. BTC, on the other hand, is basically tolerated for the time being.

⬐ ihsw

Bitcoin is more than a currency, it's also a massive, international, and reliable transaction network. Furthermore it isn't tied to any individual entity (government or corporation) so there is value in its impartiality and lack of restrictions on senders or recipients.

⬐ umsm

I think everyone is over-reacting... He clearly states that they're thinking about it just like everyone else...

⬐ illuminate

And the free publicity gets whatever else he was talking about heard.

⬐ ok_craig

A lot of what keeps regular Joes away from bitcoin is its complexity and the difficulty of keeping your funds secure. If PayPal were to make the most secure, easiest-to-use bitcoin wallet, they could profit greatly from it and also provide something that doesn't really exist anywhere yet.

All PayPal does right now is help you get dollars from point A to point B, and in the process they take a cut. They could do the same thing with bitcoin. I don't think it would be competition with bitcoin, it would be promoting it to mutual benefit.

I would be afraid of them providing this service without allowing you to export your data, however, which seems like the kind of thing PayPal might like to do. If your bitcoins were trapped in their system you're always in danger of having your account frozen as has been a problem up to now. Part of the purpose of bitcoin is to be able to avoid that, so I'd hate for PayPal to bring that whole problem to the bitcoin world.

But if they approach it properly, bitcoin could be a great opportunity for PayPal, instead of a threat.

⬐ vlasta2

I am sorry I cannot agree with you.

You cannot collect profits from a transaction between 2 Bitcoin users like PayPal does right now with "real" money. If the world adopted Bitcoin, it would be the end of PayPal's business model. If PayPal were ready to replace their business model with something way less profitable, but more future-proof, it would still make no sense for them to adopt bitcoin. It would only make sense if they owned significant amount (50%) of the existing bitcoins and had the code base under at least indirect control. What would happen if this were true and the bitcoiners found out? ...too many ifs.

That said, Bitcoin will never become a commonly used currency in its current form. The built-in deflation is a fatal flaw, which makes it unusable for normal buyers or sellers. It is only appealing for "get-rich-quick" investors, which is a shame, 'cause we really need a good solution (0% fee & safe) for online payments.

⬐ mseebach

It's like oil companies investing in green tech. If that's where you think the world is headed, it's better to get on the train and be a player than to get left behind.

For PayPal and BTC - even in the best scenario for BitCion, there's going to be a very long transition period, and PayPal has a very good position to profit from being an intermediate in that period. And once all centralised currencies are gone, true, PayPal's current business model is irrelevant, but by then, they'll have world-class expertise on BitCoin and can probably keep in the game as wallet operators or makers of hardware for casual transactions or whatever.

⬐ javert

> The built-in deflation is a fatal flaw

Yeah, I mean, gold didn't work as a currency all those hundreds of years. /sarcasm

⬐ wmf

Many economists believe that the gold standard contributed to several depressions during those centuries. Gold "worked" because nothing better was known, but modern fiat money works better.

⬐ javert

There is a lot of disagreement among modern economists. I definitely don't subscribe to the account you're giving.

⬐ rsofaer

The amount of gold in circulation has never stopped increasing.

⬐ draugadrotten

Nothing prevents you from creating a "bitcoin-B", "bitcoin-C" and so on. There will be enough bitcoins for everybody.

Disclaimer: I believe bitcoins are tulip bulbs.

⬐ javert

bitcoin-B would not be bitcoins, nobody would use them, and they would at best be tulip bulbs.

Unless you are using them to do something different then currency.

⬐ YokoZar

More relevantly, nothing stops you from creating a tradeable note that says "redeemable for 1 bitcoin from <trusted authority>" and then using those as currency.

This happened with gold, and also would happen if we saw a true bitcoin bank rather than bitcoin wallet -- they'd pay a bit of interest, and in return would pool their deposits and use some fraction of them to generate revenue through other channels.

⬐ baddox

The amount of effort required to find gold has more or less increased over time, and barring an unpredictable discovery of a huge amount of gold somewhere, the mechanics of increasing the gold supply aren't all that different than bitcoin. Or, to put it another way, I don't think the steady but slow increase in the gold supply is a substantial contributor to the current gold market.

⬐ None

None

⬐ pradocchia

No. Gold production has definitely become more energy intensive, and in this regard it is somewhat similar to bitcoin. HOWEVER, with bitcoin, marginal mining cost is a function of cumulative supply. As supply reaches 21M, marginal cost goes to infinity, and it doesn't matter what technology you bring to bear. Whereas with gold, technological advances have moved the equivalent of bitcoin's 21M to 42M, 84M, etc. The maximum possible supply increases. Yes, of course at some point the technological maximum will reach the physical maximum, but we aren't there yet.

The result of all this is that gold supply has grown with the economy over the past 500 years. It may be deflationary relative to fiat currency, but it is nothing like the deflationary profile of bitcoin, not at all.

⬐ codeulike

If the bitcoin protocols changed to allow divisions to 9 decimal places instead of 8, would that be viewed as an increase in the money supply, or no change, in traditional economics?

⬐ nly

Would re-introducing a half-penny coin increase the money supply? No. Basically, as long as you maintain proportionality, you can re-denominate currency (or shares for that matter) at will.

⬐ dragonwriter

> Yeah, I mean, gold didn't work as a currency all those hundreds of years.

Actually, it didn't. Gold was almost never the exclusive currency, usually wasn't the most common currency, was rarely a significant direct currency (rather than backing for currency) when people actually used currency for most transactions, and when it became the exclusive backing for currency, only "worked" because the actual circulating currency supply became increasingly disconnect from the gold notionally backing it.

Gold, as a currency, works tolerably well much of the time (though still can break an economy with unexpected surpluses or shortages) in the way it was actually used -- the high-value-density one of several commodities used in currencies in systems where most transactions using currency don't use gold, and most transactions don't use currency at all, but not even tolerably well outside of that domain.

⬐ ok_craig

There's no reason PayPal has to build a vanilla bitcoin wallet interface. It's true that you cannot simply deduct a certain percentage from a direct bitcoin transaction. However, they could pool your coins in their own controlled address, and when you choose to send a payment through them, it makes one transaction on your behalf for that amount, and also a second transaction for 1% to their revenue address.

Average Joes who don't want to bother having to understand bitcoin may find this tradeoff acceptable if PayPal makes it worth it by providing a very simple and secure bitcoin interface that is better than everything else out there.

Whether you think bitcoin itself is doomed to failure due to deflation and all that is a different topic entirely.

⬐ vlasta2

One of the advantages of bitcoin is that you do not need a middle man to do a transaction. Some people may choose one for whatever reason, but would they be OK with paying the transaction fees? Would you use a credit card if you had to pay 4% more than if you paid in cash? I do not think many people would be OK with that.

It may sound as if I am a PayPal lover and bitcoin hater, which is NOT the case. I just do not see them cooperating sensible.

⬐ clueless123

You write: "Would you use a credit card if you had to pay 4% more than if you paid in cash? "

That is exactly what happens today on the real world. If you make it convinient for me to use your "credit card", I will use it, and because of that, vendors pay the 4% fee. All paypal needs to do is to make it easy (at non bitcoin vendors for example) for me to spend my bitcoins and I will use it. Vendors will fall in line because they want my business.

The above said.. IMHO, there is no way in hell that "the man" will allow bitcoin in its current form to prosper (at least not without a heck of a fight), as to much visibility & control would be lost.

⬐ vlasta2

Today, the buyer does not experience the fee. Sellers accept it, because the middle man gives them no other choice. With bitcoins, the middle man has no leverage anymore as the buyer and the seller can interact directly. That was my point.

⬐ analog

In some cases you can end up paying a charge for using a credit card. Low cost airlines are an example. EasyJet adds a 2.5% surcharge for credit cards. People still use them.

http://www.easyjet.com/book/paymentoptions

⬐ Domenic_S

The buyer does experience the fee in the form of increased price. They just don't notice it because it's baked in. Anyone who buys stuff at the grocery store in cash is financing other people's rewards points.

Ever wonder why Arco is the cheapest gas?

⬐ baddox

You don't need a middle man for physical cash (let's use USD as the example), but services like credit cards and debit cards are extremely convenient. Middle men can certainly be of great value to the bitcoin economy, by providing similar services to the ones that already exist on top of government currencies.

⬐ pjscott

Interestingly, Bitcoin does support transactions which have a third party acting as an arbitrator; these transaction require the consent of two out of three participants in order for the money to be transferred. PayPal is essentially a fraud detection business disguised as a money-transfer business, so this seems like a natural niche for them.

(Technically, every Bitcoin transaction has a script in a Forth-like, non-Turing-complete bytecode which specifies the conditions needed for the transaction to be valid. It supports m-out-of-n signature requirements, among many other fun things.)

⬐ johnx123-up

> Interestingly, Bitcoin does support transactions which have

> a third party acting as an arbitrator

Can you please share some references? I'm looking to implement exact scenario, but couldn't find any references yet.

⬐ wfn

As I take it, it's not really possible yet. In any case, we're talking about 'multi-signature transactions' [0]:

    A multi-signature transaction is one where a certain number of Bitcoins are "encumbered" with more than one recipient address. The subsequent transaction that spends these coins will require each party involved (or some subset, depending on the script), to see the proposed transaction and sign it with their private key. This necessarily requires collaboration between all parties -- to propose a distribution of encumbered funds, collect signatures from all necessary participants, and then broadcast the completed transaction. [0]

If you are using Blockchain's Mywallet, you might already be able to use them, as an end-user. [1]

One way to implement them is by allowing a more generic 'script execution per transaction' (not sure of wording) mechanism, proposed in BIPs 16 and 17. [2] [3]

Also see bitcoin.stackexchange question about multisig TXes. [4]

As I understand it, if you're a developer wanting to implement arbitrated bitcoin transactions, you'll have to wait. Correct me if I'm wrong though.

[0] https://en.bitcoin.it/wiki/BIP_0010

[1] https://blockchain.info/wallet/escrow

[2] https://en.bitcoin.it/wiki/BIP_0016

[3] https://en.bitcoin.it/wiki/BIP_0017

[4] http://bitcoin.stackexchange.com/questions/3718/what-are-mul...

⬐ johnx123-up

Thank you

⬐ axusgrad

Paypal would do very well buying and selling Bitcoins. Buying bitcoins with Paypal is a very common request, which most sellers won't do because Paypal makes it very easy to rip off the seller.

⬐ abrkn

Yes, this is a very common request: http://bitcoin-otc.com/viewratingdetail.php?nick=sturles

⬐ eurleif

>Buying bitcoins with Paypal is a very common request, which most sellers won't do because Paypal makes it very easy to rip off the seller.

Where are you observing that it's a common request? Could it be a common request because it's easy to rip off the seller, in the same way that assistance transferring a dead relative's funds out of Nigeria is a common request?

⬐ Devilboy

Go on any Bitcoin forum and the newbie section will be filled with people wanting to buy Bitcoin with credit cards, usually via Paypal. Some of those will be scammers but not all of them.

⬐ eurleif

Seems hard to gauge the proportion of real newbies vs. scammers, though.

⬐ amalag

Paypal already encourages you to use your bank account instead of a credit card. Paypal is not Visa/mastercard. They have to make their money in addition to whatever the credit card is making. It only makes sense they look at bitcoin as a method for frictionless digital payment.

⬐ mcantelon

"You'll never lose a penny while using Paypal."

Unless your account is frozen...

⬐ jonknee

In which case it's still not lost...

⬐ Ziomislaw

...just "stolen"

⬐ snarfy

...without the same legal recourse as you would a real financial institution.

⬐ Mahn

Bitcoin itself doesn't need PayPal, but the bigger picture here is that PayPal integrating BTC could boost awareness like few things could for the currency.

⬐ chiph

Doubtful. I expect this is a tactical marketing play to associate themselves with the current hipness of Bitcoin.

⬐ drcode

I disagree: If they had no interest in integrating with bitcoin, the smart move for paypal would be to just spread FUD about bitcoins at every opportunity.

⬐ threeseed

I disagree: If they did spread FUD they would be widely considered to be out of touch by the IT crowd. The same crowd they need to be incorporating the Paypal APIs into their apps.

⬐ obviouslygreen

PayPal already is considered out of touch by the IT crowd (and many other crowds that are actually involved in the selling or payment gateway integration end of things beyond "put this HTML on your page and use the Buy Now button").

It's still widely used because everyone knows about them and they're well-established. It's often hard to talk clients out of using PayPal because the barrier to entry for setting up an account is so low, despite the arbitrary terms and the relatively high fees and limits.

This could potentially be a bid to impress the IT crowd, which would be a good move for them if they actually follow through (it certainly won't affect my view of them, but that hardly means anything).

⬐ illuminate

It's in their best interest to ramble about any of the current hipness and simply wait out to see about the viability of integrating it into their business. If it takes off in a non-niche way, they can claim that they were "first" thinking about it today, if BTC collapses for mainstream adoption, they can adopt the next and forget about their nonexistent "plans".

⬐ jusben1369

PayPal seems to have justly earned their reputation for frustrating many developers. Having said that, this is a new President and he has done nothing but say the right things since coming in. They've also realized major improvements to their API's/Docs etc. I'm not saying it's kumbaya time just yet. But I do think some reciprocal open mindedness from the developer community is appropriate to encourage further advancements in PayPal's approach to the web dev world. At least until we see that the leopards spots are no different.

⬐ purephase

Realized major improvements is a bit of an over-statement. They've made some new APIs available to US developers while completing sabotaging their existing developer toolset and sandbox environments to the point that they're almost unusable.

I could forgive this if their support seemed even remotely cognizant of these changes, but every time I get in touch with them it's like they're hearing about it for the first time.

⬐ nemonoko

"We're thinking about it" - They better be, because if decentralized payments hit the mainstream, PayPal's 3.9% fee is going bye-bye.

⬐ amalag

Paypal takes 3.9% ? No, you have to see how much credit card companies take and how much paypal takes. They likely get less than half that.

⬐ MacsHeadroom

For international sales PayPal takes 3.9% plus a flat rate fee ($1-$5) plus a poor exchange rate which adds in a hidden 2-3%.

In total they can end up taking $12 on a $100 purchase.

But you're right, most of that probably goes to the credit card company.

⬐ hogu

that's so garbage, I remember back in the early days, they were closing down accounts used in bitcoin exchanges. Getting money into bitcoin exchanges was a huge problem.

Besides, with bitcoin, why use paypal? Is paypal going go try to act as an exchange between btc and usd?

⬐ mtgx

Instead of Coinbase being the Paypal for Bitcoin...Paypal could be the Paypal for Bitcoin.

⬐ betterunix

"Besides, with bitcoin, why use paypal?"

If you have a bunch of Bitcoin money but need to do business with people who will only accept fiat currencies, you need some kind of exchange service. I suspect that is what Paypal will do.

⬐ lucb1e

Or they start to act like Bitpay, providing payment (or donation) services. In addition they could exchange BTC against other currencies at the current market rate from a market exchange like Btc-e, mt.gox or bitcoin-central.

⬐ benhebert

I expect this news alone will make Bitcoin go up $30 - $40 today.

⬐ Mahn

It already did.

⬐ ceejayoz

A stiff breeze makes Bitcoin go up (or down) $30-40.

⬐ viraptor

It's like signal and noise. Responses to news like that are still visible on their own shortly after the event, even if the exchange rate is not stable in general.

⬐ None

None

⬐ nazgulnarsil

This along with comments from Western Union have surprised me. But it does make sense. These companies would be foolish not to stay open to pivoting with market demands. Right now it is "we're aware of it", if it starts to take off I expect them to integrate it into their business models to capture part of that growing value.

Remember that in the gold rush you got rich selling pickaxes. WU and Paypal stand to profit from bitcoin with very little risk if they play it right.

⬐ oomkiller

Didn't Paypal start out as a Palm Pilot app that transmitted money using cryptography? I think it's interesting that bitcoin is kind of the 21st century version of that.

⬐ iguana

Anything that increases bitcoin liquidity is good for bitcoin. Anything that increases PayPal's market opportunity is good for PayPal.

A lot of people want to purchase bitcoins with their PayPal accounts, and since PayPal is already licensed as a MSB, this just requires technology. They can build or buy (Coinbase), and make a pretty significant revenue on conversion fees. They could also charge a small fee for bitcoin transactions over a certain amount, in exchange for convenience, or, for example, transaction insurance, which can be underwritten, eliminating the risk.

PayPal can do a lot for Bitcoin, and vice versa. If Bitcoin continues to be successful, PayPal can continue to have a significant portion of the online transaction pie.

⬐ unreal37

Why wouldn't Paypal invent its own Bitcoin (i.e. Paycoin) and have complete control of the system? Why would they want to use Bitcoin at all?

I mean, they're the 800 lb gorilla of online payments. They'd be smarter to invent their own thing than to use someone else's if they can.

⬐ Mahn

Yeah, and for that matter, why would anyone partner with Facebook, when you could easily build another social network? I mean look at Google, they clearly pulled that off without a problem.

Bitcoin is used and has value. The same could most likely not be said about a hypothetical currency created by Paypal, specially considering one of the most important assets Bitcoin has is its decentralized and unregulated nature.

⬐ lucb1e

Can't click this link right now. Abbreviated transcript please?

It's weird to see Paypal and Bitcoin in one sentence on the domain bloomberg.com... Bloomberg is one of the biggest financial companies and entirely against Bitcoin. I can't rhyme this; what are they saying about it?

⬐ magoghm

He say's: Bitcoin is truly fascinating. For us at PayPal it's just a question of whether bitcoin will make its way to PayPal as a funding instrument or not, and we are kind of thinking about it.

⬐ lucb1e

Thanks a lot!

⬐ apaprocki

> Bloomberg is one of the biggest financial companies and entirely against Bitcoin.

You say this as if it is fact. Care to expand on why you feel this way?

⬐ lucb1e

It seemed to me that they were publishing negative news articles about Bitcoin non-stop while the price was climbing. I have a Google News Alert for Bitcoin, and (if I remember correctly) almost every day there would be some negative headline about it from Bloomberg. I then looked up what kinda website it was on Wikipedia, and it turns out they make up 1/3rd of the global financial data market. That kinda confirmed their motivations for me.

I might still be wrong of course, perhaps I should have made more clear that it was my opinion and not really a fact. To me it was like a fact, but now that you make me think about it more objectively, I realize that I can't really say for sure.

⬐ apaprocki

Some of the articles you mention are actually op-ed pieces that are published on bloomberg.com. Those types of pieces allow the writer to express their own opinion, whether it be positive or negative. They should not be treated individually or collectively as the opinion of the company, however. Sometimes it is unclear to readers that a piece is an op-ed, so I can see how the viewpoint might be attributed to the company. I can assure you though, there is no company-wide secret agenda to discuss it negatively. My own personal opinion is that the community does not do a good enough job of educating non-programmers about the details of the ecosystem. Here's an example of a good discussion (my personal opinion):

http://www.bloomberg.com/video/bitcoin-is-gold-for-nerds-con...

⬐ ceejayoz

Bloomberg is a news organization too. Them not covering financial news like Bitcoin would be the weird thing - it'd be like FOX News not covering terror attacks because they're anti-terrorism.

⬐ tlrobinson

Yeah, just like Western Union was "thinking about" Bitcoin.

⬐ altoz

It sounds like they see it as a way to get money into paypal. That is, it's no different than a bank deposit. In other words, an easy way to transfer BTC->USD ("funding instrument"). What they'll then do is dump the BTC they get on the market.

Not a bad idea, but it seems they're thinking too small.

⬐ Havoc

BC does lack an easy way to buy them right now for many countries, so this would be welcome. e.g. I'd either have to find a local seller (unlikely) or go through 2x different online "currencies" till I get the BC.

⬐ Havoc

Its strange though to mention something like that at a "thinking about it" level. If paypal were to actually implement it, surely taking the world by surprise would be the better strategy.

⬐ madmaze

It's interesting they showed paypal.com screenshots from early 2000's

⬐ purephase

It's changed since then?

⬐ smaili

What would be the benefit for PayPal adding Bitcoin? I feel like this is analogous to BoA saying you can now login to our site using your Chase account...Doesn't make sense to me.

⬐ johnward

Is everyone forgetting that Paypal just sucks in general?

⬐ bithive123

At least it can probably handle more than seven transactions a second, unlike the Bitcoin network. Future of currency indeed.

⬐ iso8859-1

The network is P2P, there is no limit to the amount of transactions per second it can handle. MtGox is not the network.

⬐ bithive123

Incorrect. From the wiki:

Today the Bitcoin network is restricted to a sustained rate of 7 tps by some artificial limits. These were put in place to stop people from ballooning the size of the block chain before the network and community was ready for it. Once those limits are lifted, the maximum transaction rate will go up significantly.

Of course, a significant increase from 7tps still might fall well short of what is required for real commerce. If you look at this graph of the daily transaction rate, you can see that the actual performance of the network is somewhat less than 1tps:

http://blockchain.info/charts/n-transactions

For comparison, there are probably more than seven transactions per second going on in any small to medium sized city, let alone worldwide.

⬐ aioprisan

aren't bitcoin transactions irreversible, making it incompatible with PayPal general policies?

⬐ illuminate

It's a perfect method to transfer BTC ~into~ someone's PayPal account.

⬐ bonzoesc

Bitcoin transactions are irreversible, but so are cash transactions. Wrapping either currency with a transaction model that introduces a delay between commitment and transfer allows reversing during the delay.

Paypal transactions are reversible because there's a delay between me confirming the order with a merchant and the funds appearing in their account.

Paypal bitcoin would be similar; I deposit BTC with Paypal, and a week or two after I approve sending to a merchant, the merchant gets BTC in their Paypal account.

⬐ felipelalli

Great! :)

⬐ knodi

Please don't. Bitcoin is a ticking time bomb. When it goes off you don't want to be the one holding the coins.

⬐ psionski

Dude, don't mention bombs and bitcoins on the Internet. CISPA passed and if they kick your door down, you'll most probably have to pay for the repairs out of your own pocket.

⬐ khet

If Bitcoin does succeed, I don't see a regular person wanting to manage his own wallet and security let alone understand all the complexity that is bitcoin.

I see Bitcoin becoming the underlying infrastructure on which companies like Paypal, Square, Banks and other financial institutions trade.

If Paypal does invest in adding Bitcoin, it would be right step ahead for Bitcoin and for Paypal.

⬐ mtgx

Wallets are never going to be mainstream the way they work right now, so for most people, online wallets are the way to go - at least until hardware wallets are a common thing, like say in the form of a ring. If that ever catches up, I think it will be the way to go for people who want to have personal wallets.

⬐ marblar

Why not have it on a card in a wallet? I still expect to carry some dead tree money in this scenario.

⬐ None

None

⬐ Drakim

The real win is that if it becomes the underlying infrastructure, it is still possible for the common man to have a "manual wallet".

You won't end up in walled garden situations where a single vendor controls with massive fees and restrictions, but you have no choice but to use them, because hey, that's all everybody accepts and uses.

If an online wallet service/paypal/visa is gonna keep your business, they have to make what they offer be worth their fees.

⬐ blake8086

What if you have large vendors like PayPal only offering transfer to other institutionally-controlled wallets?

for example: "Since your funds are transferred only between other PayPal users, PayPal can always reverse a fraudulent transaction."

Then you would have a veritable roach motel of bitcoins.

⬐ jjs

There's the value: a trusted* escrow service.

(* Well, within the known limits of how far Paypal can be trusted. )

⬐ celticninja

you could easily send BTC out of paypal to any bitcoin address, they could nto sue it and disable those coins from accessing the blockchain. However they could say that if you do a BTC transfer from paypal account to paypal account they could offer protection then by freezing the funds or having a 5 day period before the user could withdraw them. Once they are withdrawn there is nothing paypal could do, of course this removes the immediacy of payment aspect of bitcoin so merchants may not want it.

Really because bitcoinoffers low fees this sort of service would be of benefit to the buyer only.

Alternatively PayPal could use bitcoin as their backend for transferring money internationally. If i want to pay someone in USD but only have EUR then they could exchange EUR for BTC then BTC for USD and pay the USD to whoever I was paying.

⬐ ewbuoi

They could place any restrictions on it they want if they keep both keys secret. They could also just keep all the bitcoins in the same wallet, and keep track of how much each account owns.