The main interest in cryptocurrency is becoming more evident as major online payment systems such as PayPal begin to support digital currencies. While this is a revolutionary step for both the cryptocurrency and traditional financial industries, it is imperative to comply with the regulatory requirements of cryptocurrency support companies.
This year PayPal obtained its first conditional cryptocurrency license from the New York State Financial Services Department, which allows you to purchase Bitcoin (BTC), Ether (ETH), Bitcoin Cash (BCH) and Litecoin (LTC).
At first glance, PayPal appears to have revised the basic requirements for cryptocurrency support. What is really striking is that, in order to secure PayPal’s cryptocurrency service delivery, a company with a market value of more than $ 127.58 billion as of December 2019, decided to partner with Paxos, a regulated financial institution that specializes in digital assets. … …
Bob Reed, CEO and co-founder of Everest, the fintech firm that regulates financial institutions, told Cointelegraph that for a company as large as PayPal, the partnership with Paxos is impressive. He said, “PayPal studied cryptocurrency adoption and decided it needed to work with a digital asset company to do so.” Looking to the future, Reid thinks PayPal will eventually have to partner with Crypto Cold Store, adding:
“I think we’ll start to see many traditional players like banks and large payment systems partnering with crypto appraisers. PayPal will be the first, and banks and other financial institutions will follow.”
As another example of a partnership between cryptocurrencies and traditional sectors, Everest recently entered into a partnership with BRI Remittance, a subsidiary of one of Indonesia’s largest banks, to provide users with a blockchain-based platform that allows Indonesians and Europeans to easily exchange value across international borders. Reed also shared that the company is now also working with Bank of Papua New Guinea.
Corporations receive regulatory support for cryptography
Notably, PayPal is collaborating with Paxos to enforce digital currency regulations, but it’s also important to note that smaller payment processors around the world follow suit. However, these companies have a different way of ensuring that these rules are followed.
South Korean payment provider Danal Fintech – a subsidiary of Danal, one of the largest payment companies in South Korea – recently announced that a digital Paycoin app will integrate the Icon coin (ICX). This will allow Paycoin users in Korea to pay via ICX with one of Danal’s 60,000 business partners, including major retailers such as 7-Eleven, KFC and Domino’s Pizza.
Danal Fintech CEO Ted Hwang told Cointelegraph that the subsidiary originally launched Paycoin in April 2019 and was one of the first companies to use virtual assets for retail payments in Asia. Hwang shared that although Danal owns about 50% of the mobile payments market in Korea, equivalent to $ 5.5 billion annually, it has been difficult to convince retailers to accept the cryptocurrency:
“There are many factors and questions, such as whether the cryptocurrency is acceptable as a legal form of payment in this country or whether a local micro-payment license is required to provide such a service.”
To overcome these issues, Hwang explained, Danal Fintech decided to file a legal settlement for its merchant partners. “Local sellers and our local partners will receive legal tender payments through Danal, regardless of whether the cryptocurrency is used or not,” he said. Hwang further explained that the process is no different from current payment solutions in terms of settlement, noting that it has helped remove regulatory barriers in regions such as Asia.
Interestingly, the concept of allowing merchants to accept cryptocurrency, but still be stable in depositing cash, seems preferred. Merrick Theobald, vice president of marketing for payment service provider BlockPay BitPay, told Cointelegraph that while cryptocurrencies are gaining momentum, many companies still choose to trade fiat currencies only. However, Theobald explained that many customers, employees, subsidiaries and entrepreneurs see value in cryptocurrency, especially when it comes to payments, as there is “a growing demand for faster, simpler, and less expensive payment options.”
BitPay recently launched a service called BitPay Send, which allows companies to pay employees’ salaries in cryptocurrency and ensures that the company never has to buy, own, or manage cryptocurrency. But company employees will still be able to receive payments in cryptocurrencies such as Bitcoin.