Topic: Paypal accepted the Crypto but it will reduce the BTC marketcaps (Read 259 times)

How they sell fake bitcoin tho? "bitcoin" that is IN the bitcoin blockchain is real bitcoin and I think it's impossible to create bitcoin out of thin air except they do hardfork or something like that making their own version of bitcoin otherwise it's not gonna happen and to manipulate bitcoin blockchain is like doing some kind of miracle. it's nearly impossible. BTC market cap will not be affected paypal literally become a payment method only here nothing more.

I agree that they are very low, but they are not and can not be zero. It doesn't matter how big, how reputable, or how trustworthy the third party (or parties, in this case) you are using - there is always a risk that they do something shady, and you will never be able to prove 100% that they are holding the coins that they say they are 100% of the time. There have been a number of big exchanges which people consider "trustworthy", such as Huobi and OKCoin, which have been found to be running fractional reserve system and lending out and investing user's deposits without their knowledge or consent to make more profit for themselves. There is no way you can know that PayPal or Paxos won't do the same thing. The risk is low, yes, but it is not zero.

The only way to know that you actually have the coins you think you have is to control their private keys yourself.

I could say they are pretty close to zero.
What advantage would be for them to not buy those coins and keep the $?
The risks are insane, if BTC goes up by x2/x3 and they have a few tens of millions invested they will need to come with that money if people decide to cash out, where would they pull that out? Gamble huge amounts of bitcoin going down? Again not the smartest thing.

You do this with things that have slim to none chances of doubling their value, you can play with gold this way as long as you get a constant influx of money but one small pump in the markets and your whole business is turning into a Ponzi scheme. For what? They already have published some pretty high fees for those so they will milk a lot of money from their users, it's simply not worth it.
Of course, for a new private company that would have gone with this approach, I would say the chances are well above zero, I'm very doubtful Revolut does this,  and I call the chances in double digits but PayPal already has a thriving business and its a public company they wouldn't be able to hide this.

The chances of Paypal playing dirty I consider to be minimal, the chances of Paxos making a mess and losing some coins are way higher in my opinion.

Mate, I think you don’t know what you are saying here, like for real, what do you mean by they will be selling fake bitcoins that are generated our of thin air?

What does that mean, how does anyone just generate Bitcoin? I know for sure that once they start offering this particular feature it’s not going to be just buying and selling Bitcoin, I believe users will also be able to buy Bitcoin and send to addresses from a different wallet that is PayPal based.

So, if the bitcoins are fake and generated, how do you think this is going to work? Get your facts right before you talk please, stop posting whatever comes to your mind without verifying it.

Same as we get digital money through the net banking created out of thin air, it isn't possible to do the same on bitcoin. If paypal is a new company getting into the transaction business, then there is possible chances of paypal doing it. A company that has gained good reputation in the market will not ruin it.

Sure, that wasn't meant to encourage people to invest on Paypal or downplay the security risks. It was just a comment on this idea that Paypal balances are fake BTC printed out of thin air. On the contrary, I expect Paypal to have quite a bullish effect on the market because the BTC they'll be accumulating on behalf of customers will be quite real.

I don't disagree with you, but there are a significant amount of people who already use bitcoin in a completely non-decentralized way. Coinbase hold over one million bitcoin belonging to their users in their cold wallets, and that's just one exchange. All the exchanges, all the custodial web wallets, all the third party services, and so on. Indeed, there are already numerous services just like PayPal which allow users to "buy" bitcoin, but never actually withdraw, hold, spend, transfer, or use it. PayPal is simply the latest company to jump on the bandwagon for their own profit.

Holding coins you don't own on PayPal is not all that different from holding coins you don't own on Coinbase or any other centralized exchange. The difference only comes when you withdraw the coins and hold them yourself.

Just like other exchanges, they can have their off chain transactions or they will just have a note that the transaction made was successfully processed and they are not obliged to put a transaction id that can be seen on the network.
It's only like labelling that it's transaction id but it's for their own record and it's not publicly broadcasted.

I tend to agree with you on this statement.  Paypal is just a payment processor who adopts Bitcoin as a part of payment but it doesn't mean this is your wallet that might hold a huge fund.  It might you will have a fake amount of Bitcoin in your Paypal account that doesn't have an effect on the Marketcaps, the same as the custodial wallets that they had their own hot wallets as the main receiver of any amount transfer.  But Paypal was totally different because you can't even transfer your Bitcoin into other addresses, which means it's pure for the purpose of payment processor.

A good benefit for Paypal accepting Bitcoin is the awareness of people, if they will understand how Bitcoin works, for sure they will find ways to hold Bitcoin together with the key.

That's not the plan. Paypal doesn't handle BTC, as we keep repeating. If you have bought "BTC" on Paypal, and want to use it to buy something (when that will be activated), then Paypal will sell the BTC needed to pay the merchant in his fiat currency. Money back can still work, but you will have the "conversion risk" already existing when going from one fiat to another, meaning if BTC has gone up in price, you'll get less back. If BTC has gone down, you will get more.

I have never agreed with the view that it is easy to make money from Bitcoin in particular and all financial markets in general. If anyone could be led to easily earn Bitcoin, then surely the value of Bitcoin would decrease exponentially! Here is the reason :
+ When a coin is too easy to make, it is certainly not a coin of real value, that is the law of nature.
+ What do you think when everyone doesn't need to do anything but buy insurance and make a lot of money every year?  Wasn't this the mechanism of many scam projects before?
->> So this marketing would be really wrong and it would cause the value of bitcoin to decrease over time. We should all learn how to make smart money instead of wanting to make this game easier.

The whole idea of bitcoin was to be decentralized, if we move to paypal and let them do our banking, what would be the difference of bitcoin with paper money? Sure we are still decentralized in the currency part of it, but we would basically be not decentralized in how we use it, it would become highly centralized version of a decentralized currency and I do not find it enough.

I am not against using centralized places when we need some services, sure use paypal to pay for stuff with crpto that is fine, but to let them keep all of my money? I am not sure if I am comfortable with that at all. Hence I think the payment process should be used and paypal is great at it and everyone uses them, but that should be it, nothing more than that should be used from them.

Anything Paxos does buy on behalf of PayPal will be held in their general cold storage and mixed with all other bitcoin they are holding. Individual users or even PayPal won't have a single address they can check for funds.

That only proves PayPal have that amount of bitcoin right now. It says nothing about the other 99.9% of the time. And even then, there is no way to check if that covers all their bitcoin holdings. If they put 1,000 BTC on an address, how do we know PayPal customers haven't collectively purchased 10,000 BTC?

I agree they are very low, but they are not zero. Much better to hold your own keys and your own coins, where the odds of any fractional reserve shenanigans are exactly zero.

Lolz and I've said the exact same thing. I mean tell me, what's the difference between an intermediary and an escrow? Both of them do the same thing, the only difference is, (sometimes bank) one acts without asking for direct consent while the other (escrow) always asks for consent of both the parties as well as confirms both ends before releasing anything to anyone. Tbh, I don't think Paxos or anything on the ground has the ability to meet the demand of millions of customers PayPal has, and so, I don't believe PayPal is actually buying BTC.

bitcoin marketcap depends on its market price (total supply is fixed, and unchanged). PayPal can have its noise for bitcoin and more eyes will pay attention on bitcoin. I am not saying that Paypal news can help price of bitcoin to increase now, next several weeks or in the long run but there is a bull run for bitcoin. The run began before the Paypal news and as said, bitcoin price will be used to calculated its marketcap.

You do not buy bitcoin on Paypal. They cooperated with another third party company for their feature and bitcoin trades.

PayPal is know before accepting bitcoin they have prepare for transaction process and buying bitcoin safety without purchase with fae bitcoin, every one know which one fake bitcoin or not because looking on the market they will know how much bitcoin price now. I think PayPal only available for purchasing bitcoin and bigger altcoin listing on the market, PayPal is not exchange market where could list any coin because will give bad reputation for PayPal at the future with scam and fake coin. You should understand PayPal is not an exchange market but PayPal just take trough way to purchase bitcoin and altcoin by using PayPal fund. PayPal only listed coin have think is trusted coin and never give chance for new coin list on PayPal.

If these are real bitcoins then paypal would need to remove money back guarantee tag/insurance from the items paid via cryptocurrency & users would be allowed to withdraw those funds to their crypto wallet.

Furthermore, people who do not receive the cryptocurrency payments, can only be able to buy bitcoin and hold on their paypal wallet, they would not be allowed to withdraw as there could be chances of scam like someone who sell something and does not deliver then convert their money to bitcoins and then withdraw to his/her crypto wallet

Possible, but Paypal is very tightly regulated. They were issued a Bitlicense (the most rigid crypto licensing scheme in the world) and Paxos (a New York trust) is handling the custody. I would say the odds of fractional reserve shenanigans are very low.


That's not how market capitalization and market liquidity work. For the market cap to be reduced, the price needs to fall. Why would Paypal launching Bitcoin support cause the price to fall?

Not an escrow or a bank, just assume PayPal act as an intermediary, between users, exchanges, and merchants.
The main question is whether Paxos really provide bitcoin for users or buy bitcoin in the first place when PayPal request it.
if users can't withdraw bitcoin from PayPal, only buy, sell, and purchase on merchants, we'll never know about the bitcoin reserves on Paxos.

o_e_l_e_o : I have understood the same thing as you, however I'm not that pessimistic. It's very possible we might be able to check at some point, for example once Paypal has gotten a certain volume of BTC bought on their platform (thousands) they could ask Paxos to put a significant amount of that on an address and publish that address for all to see. That's the beauty of the blockchain, after all.

Will they do it ? Time will tell.

As I read the statement of our buddy here, this is not proven yet but what I analyze was only an accusations for PayPal. Fake Bitcoin can be determined because the address can be checked online if it's based on blockchain network, so if he can send us proof or link maybe it's a better representation. The acceptance of crypto of this site is a good alternative to make payment transaction more efficient to all online shoppers.

Basically looks like contracts that we get while doing leverage trading, but here, no leveraging is allowed. I believe PayPal is just making a fool of us by saying that they will be the buyers on our behalf. TBH, only a fool would buy from them knowing that the coins aren't in our possession (or maybe there won't be any coins at all if nothing is purchased). Buying it from exchanges or P2P markets is a great deal in order to just save our BTC in our own hands rather than giving PayPal the opportunity to do it. Well, who is PayPal here? An escrow (or a bank)? Do we really need a "bank" to rely on when it comes to holding crypto?

It will be like a CFD contract on the stock shares market, so the total turnover of "fake BTC" can affect badly the crypto markets. Logically, the awareness will increase but PayPal users will use contract addresses which can decrease the demand on global markets. Otherwise, it is good news from all perspectives. Fake BTC contracts will not make a huge difference because the smart traders and investors will not use the contract instead of real BTC.

There isn't, though. PayPal say that when you buy bitcoin on their platform, then they will use their third party provider (Paxos) to buy bitcoin, which they will hold in their Paxos account on your behalf. So you have to trust that PayPal have actually bought the coins which they say they have, and you have to trust that Paxos have actually provided PayPal with the coins which PayPal have (maybe) asked to buy from them. There is a lot of trust and zero ways to actually verify that the amount of bitcoin which shows up in your PayPal account is actually being held on a wallet somewhere for you.

It is not that they are generating "fake bitcoin" as OP puts it, but rather they might not be buying bitcoin at all - we have no way of verifying. And even if they do buy bitcoin on your behalf, you can't do anything at all with it. You can't withdraw it, can't transfer it, can't spend it, can't send it, can't hold it, can't use it. All you can do is sell it back to PayPal. All you get when you use PayPal is a number on their database, nothing more.

I get it. I think there's one platform that's very familiar to me that also do this but I'm not sure if they do it really because I've just read it from another individual but I don't have any proof that they actually do it.

Yes, thanks. I understand that you're only virtually trading bitcoins but when you want to withdraw or transfer it outside the platform, it won't proceed. But we need to wait for more for PayPal's move if they are like that.

Yup, we need to wait for the verification first coming from PayPal themselves.

I don't understand what do you mean about fake bitcoins. If you are referring to the fact that they will not sell real Bitcoins, you are wrong. PayPal is a big company that is probably undergoing regular audits.
They haven't said anything about creating synthetic products backed by Bitcoin (and even in that case they would have to demonstrate their Bitcoin holdings).

I agree. His entire argument is around PayPal's BTC being faked but how does he know that? Where is the evidence for it?

If indeed it turns out the BTC on PayPal is fake then sure that will lead to a huge problem.

However, until that is verified there is no weight to this 'panic'. Indeed there are ways to check the validity of these coins and I suppose people with means for

checking and great concerns will do exactly that. But I must say I do not appreciate this 'panic' lead discussion as it might lead to more trouble, specially for newbies.

I don't think that kind of a huge company will do that.
It will be a big stain on their reputation.

How much it will cost them to just being stupid?
If I am the owner of Paypal I won't do such a thing. I built my roots and it's already a large tree with fruits.
Don't want to waste it because of the newly added feature.

When he say fake bitcoins the number that you bought can see in their platform but you can't transenfer it to your wallet . You need to sell it again to $ if you want to widraw your money you are like buying fake Bitcoin because you can't transfer it and the value will only determine by them it is like a trading platform of Bitcoin but you can only use that Bitcoin in their platform and you can't transfer it .

I do not think it will do any damage to the market, traditional traders and investors will not run to PayPal because of the limitation you mentioned.

If you are not able to withdraw your BTCitcoin or send your coins to a third party wallet and you are only able to trade (buy and sell) within the PayPal platform then it can be assumed that they are providing virtual coins, until things are clear about their stand on how they are dealing with it, we can assume that they are dealing with fake coins .

Paypal will neither increase nor decrease bitcoin market cap. The market cap is now around 18.5 million BTC and it is increasing at rate of 6.25 BTC/block. Paypal has nothing to do with bitcoin market cap.

As I said, there won't be any change in bitcoin market cap.
And even if paypal was supposed to decrease the market cap, it would be a good news. Less market cap causes less supply and higher prices.
We don't know whether Paypal will create fake bitcoins out of thin air or they will store equivalent amount of bitcoin sold to their customers in a wallet.

Why do you say that they will be selling fake bitcoins? it's easy to determine if they will do that and just going to sell bitcoin that was made as an ERC20 token or any chain for altcoins. We have to wait if they will actually do that but I'd assume that they won't. They can't do that as they're one of the biggest payment processors in the world and just dive into cryptocurrencies. Do you have any source telling that they will doing it or gonna sell fake bitcoins as you're saying?

Paypal accepted the Crypto but it will reduce the BTC marketcaps

PayPal accepted the cryptocurrency buy/sell trading on its platform but that is not a good news and it will not be increasing the bitcoin marketcaps anywhere since these are the fake bitcoins which are being generated out of thin air so how you can think that it will increase the demand or use of the Bitcoin or other cryptocurrency?

PayPal process around $200 billion+ within 3 months, if half of the people trade fake bitcoins on their platform then it will eliminate $100 billion+ every 3 months from the cryptocurrency market.

If these fake bitcoins are generated then it will effect the crypto market badly. Bitcoin's total marketcaps will be hitting to ATL soon.

+

Blockchain.com is not good comparing to its 12%  APY - Need a different thing

Blockchain.com issue only 12% APY per year while bitcoin has too much fluctuation, On daily change it could go up upto 12% up and around -4%-5% down which is around atleast 60% per month. We need something different which may auto sell our cryptos whenever it hits its ATH and buy those crypto again whenever it hits its ATL and I want that there should be either a bank who may do that or either there should be binance or coinbase involved or maybe any good organization along with good reputation and users trust (like Microsoft/Amazon) may do that. That bank or organization is needed to be insured too. If this happens then it will not only increase the bitcoin marketcaps rapidly but will also attract more and more people to join bitcoin and it will also resolve the world's major problem which is poverty p.s you don't know regarding how good this could be, it will increase the businesses growth too much all around the world. Just assume that you only have $100 in bitcoins in your wallet and after a month you find that your wallet has $160 and next month these $160 converted to much bigger then how many people will join to only accept bitcoins?

If bitcoin is accepted all around the world then the total wealth of the world is around $360 trillion which is currently increasing around $9.6 trillion per year which means that if this happens then there will be an addition of upto $9.6 trillion per year in cryptocurrency market capitals.