New reports on internal PayPal practices have some traders wondering if the established payment platform and new cryptocurrency trading mechanisms from companies like Ripple will always be rivals, or not.
Cointelegraph reports today on news from financial network Cheddar, where Tanaya Macheel and another anchor talk about a new PayPal employee program that uses blockchain for a company rewards system.
It’s an interesting model where employees collect tokens that can be used for various prizes featuring interactions with top executives, and even access to a playful pup owned by head of investor relations Gabrielle Rabinovitch.
The program, which has been crafted over six months at the company’s San Jose innovation lab, is being compared to peer to peer systems like Venmo in terms of activity feeds and group access.
“This is huge,” Machella says, reporting about PayPal’s program on air. “We haven’t really heard PayPal say very much about using the blockchain … “
However, she points out, there have been some concerns about security and logistics.
“PayPal doesn’t just work with retail investors,” Macheela says. “There are a lot of merchants – that could be dangerous to them.”
Nonetheless, Macheela applauds the kind of innovation that puts blockchain into these types of “gamification” environments.
“I think it’s a good lesson in token economics and a great learning initiative for employees,” she says. “It’s kind of exciting.”
So if you’ve been trading in crypto based on the proposition that PayPal is going to be a major nemesis, you may want to recalibrate that thinking a bit.
In addition to the internal employee program, there’s news that PayPal has been working on a cryptocurrency patent to enhance transactions with secondary private keys.
However, this other example of PayPal activity reveals an unfortunate potential trend related to cryptocurrency innovation. Citing bitcoin developer and the crypto consultant Peter Todd, Cointelegraph reports experts are looking at whether PayPal is actually trying to patent technology that’s already been spearheaded by a bitcoin wallet company called OpenDime.
The problem with forging ahead in developing cryptocurrency technologies is that you have to have a lot of technical savvy, and also in-depth knowledge of the market.
It’s going to be all too easy for executives to come up with a bright shiny new idea and start going gangbusters with it, only to find that there are patent conflicts or potential regulatory violations involved.
With that in mind, it’s time to consider that even major “web 2.0 payment” programs like PayPal are jumping on board with the blockchain revolution.