PayPal CEO Schulman says cryptocurrencies just an experiment for now

Power cables connect to cryptocurrency mining rigs composed of Antminer S9 ASIC machines on racks at the HydroMiner GmbH cryptocurrency mining facility near Waidhofen an der Ybbs, Austria, on Friday, Jan. 19, 2018. Photographer: Akos Stiller/Bloomberg

Despite the hype, PayPal Holdings Inc. isn’t buying into crypto for now.

Speaking at the Economic Club of New York in Manhattan, PayPal Chief Executive Officer Dan Schulman said cryptocurrencies have a very uncertain future.

“Regulations need to be sorted out and a whole number of other things,” he said. “It’s an experiment right now that is very unclear which direction it will go.”

Earlier this week, news emerged that PayPal filed for a patent aimed at expediting virtual currency transactions, leading some bitcoin enthusiasts to assume the company was taking a hard look at it. However, some analysts noted that the patent was actually filed 18 months ago and was only recently made public.

“The timing of the patent application vs. more recent public commentary by PayPal suggests that any near-term solutions by PayPal to make crypto merchant payments scalable may have been de-prioritized,” Jason Deleeuw, an analyst at Piper Jaffray, said in a note. “Still, PayPal has said crypto assets have long-term merit and could eventually see ubiquity and acceptance as an everyday form of payment.”

A PayPal spokeswoman said, “We are interested in any technologies, processes or applications that have the potential to enable our mission of financial inclusion.”

Blockchain, on the other hand, is a different story. Schulman told the crowd that blockchain will be the more powerful part of the landscape, and that cryptocurrencies are “just one application.” PayPal currently has a team looking into the potential ways it can use blockchain in the future, according to the spokeswoman.