What are the potential side effects of corporations selling fake crypto? - page 3.

mezzaluna

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Quote from: 20kevin20 on February 08, 2021, 03:29:52 PM

PayPal has started selling "crypto" but they don't let you withdraw. Hence, if you think about it, they could easily only literally sell numbers on a screen rather than a math-backed, miner-verified real cryptocurrency.

I was wondering what could happen from an economical point of view if they (or any other corporation) did this and suddenly wanted to manipulate markets using false coins. What could PayPal do to BTC?

One result that could affect them is that it can affect their credibility. Selling Cryptocurrencies just to boost their popularity would not be a great move for PayPal so I guess they are doing it for a reason and its a good thing that they would try and test it out right now since there are a lot of people who wanted to buy it and this gives them the opportunity to do so. I guess the only thing that PayPal can do is boost their own credibility while they are also boosting/promoting Bitcoin's utilization.

Princejebs

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First, PayPal is well regulated and since they are centralized, I believe they know their way out when such problems arises.
I don't think it will be really easy to manipulate with PayPal interface, their policy alone is never friendly. I don't think a customer will buy bitcoin and want to manipulate his way out of that environment.

Rengga Jati

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Quote from: 20kevin20 on February 08, 2021, 03:29:52 PM

-snip-

Indeed, PayPal is a bit dubious, how they apply the terms & conditions. Moreover, we also cannot have the private key. Initially, I also thought, could it not really be crypto.

Quote from: agustina2 on February 08, 2021, 04:52:47 PM

What's the purpose of buying BTC on Paypal if users can't able to withdraw it?

That's it. But that is what exists in their T&C about cryptocurrency.
As I quoted here taken from this PayPal Cryptocurrency - Terms and Conditions
It is said that:

Quote

You currently are NOT able to send Crypto Assets to family or friends, use Crypto Assets to pay for goods or services, or withdraw Crypto Assets from your Cryptocurrencies Hub to an external cryptocurrency wallet. If you want to withdraw the value from your Cryptocurrencies Hub you will need to sell your Crypto Assets and withdraw the cash proceeds from their sale.[quote/]

It means that we can only use crypto for buying, selling, and also converting to products provided in PayPal if we are going to withdraw.

wheelz1200

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Quote from: 20kevin20 on February 08, 2021, 03:29:52 PM

PayPal has started selling "crypto" but they don't let you withdraw. Hence, if you think about it, they could easily only literally sell numbers on a screen rather than a math-backed, miner-verified real cryptocurrency.

I was wondering what could happen from an economical point of view if they (or any other corporation) did this and suddenly wanted to manipulate markets using false coins. What could PayPal do to BTC?

Depending on market share and depending on price per bitcoin they can do some nasty things, but I would only hurt them to want to hurt bitcoin. If you have in fact amassed enough market share to make a dent if you did something negative it would hurt your own holdings as well as degredate your company's outlook. But if they didn't care about these things for some reason than yeah they can hurt a lot of people

AndySt

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Quote from: dothebeats on February 10, 2021, 10:46:49 AM

They literally just inflate their assets by essentially borrowing your funds in exchange of an 'agreement' that they are holding something for you. If they cannot provide withdrawals for 'your crypto' that you bought from them, there probably isn't one to begin with. While I do agree that PayPal taking part in the crypto scene is bringing things closer to people, it also has its own demerits, especially the one that people aren't able to actually hold their coins. The experience is very limited to just buying and selling right now, though I hope that PayPal would soon provide actual withdrawals for their customers to get the full experience of being a bitcoin owner through the simplicity offered by PayPal's platform.

The PayPal platform and the platforms used by cryptocurrencies are too different in their principles and most of them are even opposite, and therefore there can be no question of a large integration in the near future, so the cryptocurrency community should still be happy that platforms like PayPal at least accept bitcoins and contribute to the greater popularization of cryptocurrencies

South Park

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Quote from: 20kevin20 on February 08, 2021, 03:29:52 PM

PayPal has started selling "crypto" but they don't let you withdraw. Hence, if you think about it, they could easily only literally sell numbers on a screen rather than a math-backed, miner-verified real cryptocurrency.

I was wondering what could happen from an economical point of view if they (or any other corporation) did this and suddenly wanted to manipulate markets using false coins. What could PayPal do to BTC?

We already have something similar with gold, there are gold certificates that allows you to trade but those gold certificates are not backed by real gold, so far everything seems to be OK but what will happen once the economy begins to go through big troubles and people want actual gold? What will happen in that scenario is that real gold will skyrocket and gold certificates will crash, and I expect the same to happen to whatever PayPal is doing since it is obvious they are not offering real bitcoin.

bitgolden

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Quote from: hatshepsut93 on February 10, 2021, 03:53:04 AM

You'd need to get at least a few major exchanges on board with this conspiracy, because if just one exchange tried to make fake trades, everyone would quickly notice it and then no one would use this exchange and there would be an investigation. But even with a big conspiracy to manipulate the market, researchers might be able to spot it, with mathematical tools and blockchain analysis, such abnormal trades could be spotted, and there's a huge chance the people involved would go to jail.

Well, you are sort of wrong in that regard. Paypal is not an exchange and they started to sell "fake bitcoins" and everyone loved it and bought billions in bitcoin from them. How did they sold "fake bitcoins" you say? Simple, they didn't actually give people the bitcoins, they just told people that "here it says you won 1 bitcoin" and that's it, it was actually just a number and not the real bitcoin itself, nobody actually owned any bitcoins, it was just a number on a page and that's it, if you want to withdraw that, you have to cash out to fiat and withdraw that way, so paypal never really needed to own bitcoins at all.

Did they owned bitcoins? Sure they did, they didn't want SEC to investigate and destroy them, but at least they have shown the world how you could actually end up telling people they own bitcoins without giving them the real bitcoins.

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Quote from: agustina2 on February 08, 2021, 04:52:47 PM

Quote from: 20kevin20 on February 08, 2021, 03:29:52 PM

PayPal has started selling "crypto" but they don't let you withdraw.

I'm not fully aware and only have limited information about Paypal's term related to Crypto but it is for real that you can't withdraw it?

What's the purpose of buying BTC on Paypal if users can't able to withdraw it?

For now at least, PayPal is handling BTC as part of their merchant services - in other words, just as PayPal started out years ago with fiat, buying Bitcoin there is ONLY loading a 'wallet' for use with merchants participating in the PayPal system. So while you cannot exchange back to fiat or send BTC to outside addresses from the PayPal wallet you CAN spend it at merchants accepting PayPal.

When PayPal started this they had already announced that eventually things will change. Just *when*, who knows.

dothebeats

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They literally just inflate their assets by essentially borrowing your funds in exchange of an 'agreement' that they are holding something for you. If they cannot provide withdrawals for 'your crypto' that you bought from them, there probably isn't one to begin with. While I do agree that PayPal taking part in the crypto scene is bringing things closer to people, it also has its own demerits, especially the one that people aren't able to actually hold their coins. The experience is very limited to just buying and selling right now, though I hope that PayPal would soon provide actual withdrawals for their customers to get the full experience of being a bitcoin owner through the simplicity offered by PayPal's platform.

Saisher

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Quote from: 20kevin20 on February 08, 2021, 03:29:52 PM

PayPal has started selling "crypto" but they don't let you withdraw. Hence, if you think about it, they could easily only literally sell numbers on a screen rather than a math-backed, miner-verified real cryptocurrency.

I was wondering what could happen from an economical point of view if they (or any other corporation) did this and suddenly wanted to manipulate markets using false coins. What could PayPal do to BTC?

How can they do that they are using fake stat, how would the market read that when they do not have a data integrated to sites like CoinGecko, they can show anything in their dashboard but the market aggregator like Coingecko and Coinmarketcap is still the best parameter and besides they only accept US resident only how would Asian like me knows what's they are showing.

AicecreaME

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Quote from: 20kevin20 on February 08, 2021, 03:29:52 PM

PayPal has started selling "crypto" but they don't let you withdraw. Hence, if you think about it, they could easily only literally sell numbers on a screen rather than a math-backed, miner-verified real cryptocurrency.

I was wondering what could happen from an economical point of view if they (or any other corporation) did this and suddenly wanted to manipulate markets using false coins. What could PayPal do to BTC?

Market manipulation would be impossible if they are just going to use numbers on screen to scam people making them think it's a real trading platform, they would just get the money, nothing else. But for sure this will make a bad image to all of the cryptocurrency, people will start to spread FUD, and the mass adoption of cryptocurrency will be too far again for us to reach if this scams won't stop.

But if PayPal would be a scam in the end, they won't get easily away with it because many people will file the right accusation to them and they would be easily get caught since they are popular and well-known.

Betwrong

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Quote from: 20kevin20 on February 10, 2021, 04:26:44 AM

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What I was curious about is what selling unlimited false BTC could lead to, putting aside all the legal trouble PP would get into.. My question isn't really "Could they?", but more of a "What if?" hypothetical scenario..

I think if they sold a lot of fake BTC to their customers, the BTC price would drop, but it would drop on their platform only. That could affect the price of real BTC on other markets, but only on the level of how some news affect it - not much. Since there won't be additional supply of real BTC to the market, the price, formed by supply and demand, could drop only because of decreasing of demand from the people who took the news about low BTC price on PayPal platform seriously. Later those people will realize that PayPal's price has nothing to do with reality, and they will start ignoring it, and then another news about BTC pice on PayPal platform will not affect the market at all.

In short, as a result of the hypothetical scenario, only PayPal's reputation would be harmed, and that would be it.

so98nn

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Quote from: 20kevin20 on February 08, 2021, 03:29:52 PM

PayPal has started selling "crypto" but they don't let you withdraw. Hence, if you think about it, they could easily only literally sell numbers on a screen rather than a math-backed, miner-verified real cryptocurrency.

I was wondering what could happen from an economical point of view if they (or any other corporation) did this and suddenly wanted to manipulate markets using false coins. What could PayPal do to BTC?

If you just read what you stated then it would be big disaster for the "crypto currency economy". Just crunching the numbers around but no money flooding into the cyrpto is straight away a false-trap! I am not sure if the information really true because if this would have been the case then we would have seen billions of dollars in negation graph already. Since the paypal-crypto duo, lot of people have started to invest. That's a real money and there is no way they are faking such crypto-fiat buy-sell. One, PayPal will get illegitimate crypto provider tag and second Musk himself is bitcoin enthusiast so he won't let down his investors like this.

bryant.coleman

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Quote from: oHnK on February 10, 2021, 05:26:13 AM

If you see how Paypal sells their Crypto service, it seems as if this is part of a scam. Another possibility is that these are only the initial stages of maintenance which are still in progress. As long as no one feels cheated by their services, there is no accurate evidence regarding the fake crypto they are selling. The data is that Paypal users still feel safe and secure with the services provided by Paypal so that's enough so far.

PayPal is one of the most trusted payment processor out there, and it has been in existence since 1998. They operate as per US laws, and therefore the users don't need to worry that someone will take their money and vanish (similar to a lot many small sized exchanges have done in the cryptocurrency sector). The user functionality is limited right now, but I hope they will make full functions available to the users in the near future. For those who use exchanges such as Huobi and Kraken, there should be no issue in using PayPal. The risk involved is the same.

oHnK

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If you see how Paypal sells their Crypto service, it seems as if this is part of a scam. Another possibility is that these are only the initial stages of maintenance which are still in progress. As long as no one feels cheated by their services, there is no accurate evidence regarding the fake crypto they are selling. The data is that Paypal users still feel safe and secure with the services provided by Paypal so that's enough so far.

dkbit98

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I don't think any corporations are selling crypto but they are most likely buying and trading it, and we can argue that fiat currencies are also just numbers on screen, because if all people would withdraw all dollars from their bank accounts it would be impossible to pay them all.
Paypal on the other hand is a black hole for crypto and I don't like what they are doing but they surely introduced Bitcoin to more people and made it more popular with masses but they have done zero education of importance of decentralization.
Someone can fool newbies with fake crypto but they would probably end up in jail sooner or later.

Mauser

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Quote from: 20kevin20 on February 08, 2021, 03:29:52 PM

PayPal has started selling "crypto" but they don't let you withdraw. Hence, if you think about it, they could easily only literally sell numbers on a screen rather than a math-backed, miner-verified real cryptocurrency.

I was wondering what could happen from an economical point of view if they (or any other corporation) did this and suddenly wanted to manipulate markets using false coins. What could PayPal do to BTC?

This sounds a bit like a ponzi scheme to me, you are allowed to deposit money but not to withdraw. Not sure if this is even legal. How can there be a fixed value if you are not free to trade that crypto? Maybe the are just at the beginning to setup their crypto coin. But still, I don't think a lot of investors are going for such coins that can't be bought and sold whenever you want.

bryant.coleman

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A few days back, I paid $75 in transaction fee for a total of 5 transactions, which were worth a sum of $750. The fee will go up further, as the number of users are increasing at a tremendous pace. Now this situation is not viable. If I am paying a fee of $15 per transaction today, then tomorrow I can expect the fee to rise to $30. And the day after that, it can be $60. Now this is where third party processors such as BitPay and PayPal comes in. They will allow you to invest in cryptocurrency, minus the fees. Most of the users don't care, because they get the full amount when they sell their cryptocurrency. So personally, I am not against this model.

Afterall, the exchange rates increased from $10,000 to $40,000, solely due to the adoption by PayPal. Everyone is benefiting from the price rise, including the OP. Still if you are not happy, just ignore them and don't use their services. Even I don't have an active PayPal account currently.

20kevin20

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Quote from: FanEagle on February 10, 2021, 01:33:56 AM

That "can't withdraw" thing is the most important part, because paypal could have as much as 100+ million bitcoins all sold on their website if they want to, how? They can do that buy just giving people bitcoin on their accounts but as long as you can't withdraw it, what are you going to do? You have to cash it to fiat and then move it around right?

This is what I meant to ask and the main danger I think these companies are posing. By selling just the text value of a currency and not the coin itself, the markets would more than likely go through negative repercussions.

I keep reading that PayPal would not be able to easily get away with this, but we forget that before everything, BTC has seen strong hostility from governments and uf there was someone to sell false BTC in order to manipulate markets, it could be the government itself! It would not be the first time they conduct illegal actions, would it?

What I was curious about is what selling unlimited false BTC could lead to, putting aside all the legal trouble PP would get into.. My question isn't really "Could they?", but more of a "What if?" hypothetical scenario..

hatshepsut93

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You'd need to get at least a few major exchanges on board with this conspiracy, because if just one exchange tried to make fake trades, everyone would quickly notice it and then no one would use this exchange and there would be an investigation. But even with a big conspiracy to manipulate the market, researchers might be able to spot it, with mathematical tools and blockchain analysis, such abnormal trades could be spotted, and there's a huge chance the people involved would go to jail.

Topic: What are the potential side effects of corporations selling fake crypto? - page 3. (Read 571 times)