Cryptocurrencies should be used as a means of payment to grow, says PayPal CTO

Key facts:

PayPal CTO Sri Shivananda believes more use cases are needed for cryptocurrencies.

Consider that cryptocurrencies are seen more as assets than as a means of payment.

Sri Shivananda, CTO of PayPal, one of the largest payment companies worldwide, has the belief that cryptocurrencies still have a long way to go when it comes to mass adoption. Despite the support received for removing India's ban on digital assets, Shivananda noted that most consumers view them as assets, rather than as currencies with payments application.

Shivananda spoke at the last Economic Times Global Business Summit (ET GBS 2020), which was held in India. Among other financial issues, he offered his perspective on the status of cryptocurrencies. In his view, people need to start using them to make payments, rather than simply focusing on their value as assets.

Shivananda also noted that digitizing currencies is only a matter of time, given the constant growth of the internet. He added that, in his view, when all participants, including consumers, merchants, regulators, governments and FinTech companies understand the benefits and their need, cryptocurrencies will play a much bigger role, he said.

PayPal's CTO also spoke about the latest news related to cryptocurrencies, originating from his native India. As reported last week, the Supreme Court of India lifted the ban imposed two years ago by the Reserve Bank of India (RBI) on cryptocurrency trading. Although the RBI is reported to have plans to fight back, PayPal's CTO believes this was a step in the right direction.

Reason why PayPal left Libra 

When Facebook announced its future cryptocurrency, Libra, the project had the support of 23 global companies as partners. Names included Uber, Mastercard, Visa, Spotify, and surprisingly PayPal.

Regulators quickly began to slow down the project, and some of the partners ultimately abandoned it. PayPal was among those who abandoned the plan, alleging at the time, that they wanted to work in their core business.

Shivananda raised the issue of PayPal's abandonment of the Facebook project, but pointed to a slightly different reason. He said that when they initially got on board, the idea was to help the "underserved, the people who are not currently supported by the system." However, Shivananda continued, soon after the plan "felt as if that was not going to happen in the short to medium term."