EBay CEO Says PayPal Will Integrate Bitcoin

John Donahoe, President and CEO of online auction giant eBay, is acutely aware that Bitcoin and cryptocurrency are going to increase in importance going forward and that digital currency is going to play ‘an important role going forward’. He also indicated that eBay owned online payment processor PayPal ‘will have to integrate digital currencies into our wallet’.

While eBay’s CEO is bullish on the future of cryptocurrency and realizes that it’s important for his company to facilitate it’s use he was unable to give a time frame as to when that would happen. A growing number of large companies including Overstock.com, Tiger Direct and Dish Network are accepting Bitcoin but eBay is likely having to deal with some technical issues in getting it integrated with PayPal.

Donahoe thinks that Bitcoin’s initial traction with the mainstream will be as a peer-to-peer payment solution. He said that there are a variety of personal transactions that are a perfect fit with Bitcoin and from there he expects it’s use to grow as merchants begin to accept it.

eBay/PayPal has seen the writing on the wall in regard to cryptocurrency for awhile now. The company filed patents in 2011 to facilitate the acceptance of ‘virtual currencies’ and earlier this year added a category on the eBay site for ‘virtual currency’ which not only allows buying and selling of the currencies themselves but also Bitcoin mining equipment and related products. He spoke of the inevitability of PayPal integrating with Bitcoin last year suggesting that the cryptocurrency is ‘a disruptive technology’.

While there is no timetable for PayPal’s integration with Bitcoin it is a very significant development from a symbolic standpoint. There have been suggestions that Bitcoin and PayPal were essentially competing products. With the apparent move by PayPal to integrate Bitcoin as a funding option the company is indicating that they see the cryptocurrency as not a competitor but a component of their business model. More significantly, PayPal’s acceptance of Bitcoin as a payment source would go a long way in validating it with the slow adopters and mainstream users–much in the same way that PayPal itself gradually grew in acceptance after it’s creation.