PayPal and Uber ‘Unlikely’ to Follow Tesla and Invest in Cryptocurrency as Bitcoin (BTC) Hits New Record Highs

By Luigi Wewege Friday, February 12, 2021

PayPal, a leading global company in processing online payments, is unlikely to follow Elon Musk and his Tesla company to make business investments in Bitcoin (BTC), according to the company’s Chief Financial Officer (CFO) John Rainey.

PayPal headquarters.

PayPal to Focus on Other Growth Opportunities

In an interview with CNBC, Rainey confirmed that the payments business isn’t considering transferring some of its cash reserves in Bitcoin; instead, it will focus on services that can accelerate its growth potential.

“We’re not going to invest corporate cash, probably, in sort of financial assets like that,” Rainey said, before adding that the company “want[s] to capitalize on this growth opportunity that’s in front of us.”

“The types of services that we’re providing, like buy now, pay later [and] crypto as an example — even offline QR code — those are the types of things that we want to continue to invest in, be it organically or even inorganically when we see opportunities in the ecosystem,” he added.

A few days ago, Elon Musk’s EV company Tesla announced it bought $1.5 billion in Bitcoin (BTC). The EV business said it will also start allowing customers to buy their products in cryptocurrency.

PayPal’s comments are in line with an analysis of JP Morgan analysts, who believe that not many businesses will follow Tesla into Bitcoin.

“The main issue with the idea that mainstream corporate treasurers will follow the example of Tesla is the volatility of bitcoin,” the bank’s strategist Nikolaos Panigirtzoglou wrote in a note.

“Corporate treasury portfolios are typically stuffed with bank deposits, money market funds, and short-dated bonds, meaning that annualized volatility – or the range of swings during the course of a year – hovers around 1%,” he added.

Uber CEO Dara Khosrowshahi said yesterday that his company discussed investing in Bitcoin but “quickly dismissed” this option.

“It’s a conversation that’s happened that has been quickly dismissed. We’re going to keep our cash safe. We’re not in the speculation business. The upside in our company is in the business that we’ve built, not the investments that we invest in,” he told CNBC.

In the meantime, Bitcoin price has moved further higher this morning to print $49,000 — a new record high for the world’s largest cryptocurrency.

Summary

Senior officers at PayPal and Uber dismissed the option of following Elon Musk and Tesla into Bitcoin and will instead focus on the growth of their businesses through improving existing and adding new business services.

About the Author


Headshot of Luigi Wewege

Luigi Wewege is the Senior Vice President and Head of Private Banking at Caye International Bank. Outside of the bank, he serves as an instructor at the FinTech School which provides online training courses on the latest technology and innovation developments within the financial services industry. Luigi is also the published author of "The Digital Banking Revolution."

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