PayPal CEO Dan Schulman said Thursday that PayPal plays an important role in the utility of central bank digital currencies (CBDCs).
On the company’s investor day call, Schulman said PayPal is getting ready to be ‘the digital wallet for global CBDCs’.
PayPal’s newly unveiled crypto product card includes becoming a CBDC platform. Schulman said he sees PayPal’s digital wallets becoming the way central banks distribute tokens to consumers.
“PayPal is a perfect complement to central banks and the government to distribute the CBDC in a modern way so that more people have access to the digital economy, and we think this is a focus area of this new business unit we have put together has.”
Some central banks are still far from issuing a CBD. Christine Lagarde, head of the European Central Bank, said a digital euro could take years before the Federal Reserve is still in the research phase of a possible digital dollar. Meanwhile, Schulman said PayPal wants to add new assets to existing assets.
PayPal announced its product route earlier this month in its Q4 2020 revenue call. During the call, Schulman called the current financial system ‘outdated’, leading PayPal to build a new unit on blockchain and the digital economy. Schulman reiterated these sentiments about today’s investor call.
“If we move to a modern technology – it could be big book technology, it could be other technology – we will see a shift in how digital values will be shifted around the world,” he said.
And PayPal intends to take a closer look at the other digital forms of value. Schulman’s comments point to wider aspirations than just the spread of CBDC. With ‘Step 1’ on the product card, crypto is made possible as a funding tool on PayPal, but Schulman has also indicated that PayPal wants to digitize other assets using smart contracts and tokenization.
“When you think of the usefulness of blockchain … you’re talking about digitizing assets … which can be broken down into smaller parts. These are clearly things we’re looking at and what we have on our roadmap,” he said.
Part of creating utility in the present is to think about the long term and what a new financial system might look like, according to Schulman.
“This is an opportunity in a multi-decade … where the fundamental tracks are being redesigned and we have the opportunity to reform it,” Schulman said.
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