Enabling Crypto Does Not Mean There Will Be a Significant Increase in PayPal’s Earnings -Morgan Stanley Analysts

Just recently, the Analysts at Morgan Stanley, an American global investment bank and financial services company highlighted that PayPal’s projected move to enable crypto as a source of finance to about 26 million merchants will most likely scale the mainstream adoption of cryptocurrencies than improve the payment service provider’s outcome or earnings at the end of the day.  According to the researchers, this effort “should expand crypto acceptance online, which to date has stalled at 1% of the top 500 internet retailers.” 

The experts specifically stated that it is “unclear” if there is going to be a tremendous or even a significant boost in PayPal’s earnings if or when they eventually enable crypto funding on their platform. For them, financing the following bitcoin, bitcoin cash, litecoin and ether  on Paypal is “likely immaterial to earnings.”

Again, “Assuming PayPal is able to scale its crypto trading activity to Square’s current level, it would only add [0.3%] of growth to PayPal’s ~$21.3 billion” proceeds as at 2020.

The rationale behind their take is that enabling and promoting crypto adoption and transactions on their platform may not equal to a surge in transaction quantities. 

Nevertheless, enabling cryptocurrencies will scale the payment provider’s customer reach and activate its competitiveness with other major payment service brands like Square.