Payment systems have grown dramatically over the last two decades. Contactless cards, mobile payments, and digital wallets were all in their infancy 20 years ago. They are now commonplace. However, as new payment systems emerge, only a few are likely to survive in the long run. Only PayPal emerged as a standout success among the more than 200 systems introduced between 1993 and 2000.
PayPal was originally designed to enable people to "email money." However, when it entered the eBay community, it quickly grew in popularity as it provided a much needed solution to a problem that had been plaguing users for some time. Before PayPal, people would have to mail a check for a purchase, wait for it to clear, and then wait for the item to arrive—which could often take weeks. In addition, the process was further complicated by lax fraud prevention measures, as a seller could simply not mail an item after receiving the payment. In contrast, PayPal let customers transfer money from their bank account to a seller's PayPal account almost instantaneously, which was a huge improvement.
One of the biggest advantages of PayPal is that it's very easy to get started with. You can create an account and start using it in just a few minutes. This is much more convenient than opening an account at a traditional bank or financial institution, which can take a lot of time and effort. All you need to do is sign up and input your information online – no lengthy queues or unnecessary bureaucracy.
It's easy to link a bank account or credit card that you already have. Because of this, all kinds of businesses and regular people have easy access to a wide range of payment options. PayPal lets people send and receive money with just a few taps. This makes it easy to split the bill at dinner or sell things online.
Paypal has certain disadvantages and limitations, one of the most significant being that it isn't accessible worldwide. Paypal is a US company that chooses to only provide its services to a limited number of countries while completely prohibiting other countries from using its services. The majority of the countries impacted by these harsh sanctions are African countries. In Nigeria, for example, you cannot receive money into your PayPal account, but you may fund your bank card and use PayPal to make online payments.
PayPal is free to use for sending money to friends and family, but there are fees charged for business transactions. A 1% fee for instant access to your money, while a free bank transfer takes several days. PayPal is known for being aggressive with account freezes, and if your account is frozen, they will hold your money until you can prove you have done nothing wrong.
All of these aforementioned problems have led me to think about an innovative payment system that makes sending and receiving money just as effortless as PayPal does, but with all the advantages that come along with Blockchain technology and cryptocurrencies. I strongly believe that my application should have a few key features that would make it a top-notch solution in the market, which are listed below:
It has to be open, meaning that you should be able to access it and use it without any vetting or authorisation and no one gets to tell you, "no, you can't be part of this," so it has to be open. This is important for a number of reasons, the most obvious one being that if people can't access your product or service, they're not going to be able to use it.
It has to be borderless. It's important to have a global perspective when it comes to payments. Where you come from or where you are shouldn't matter; what should matter is that you have access to the same technology and opportunities regardless of your location.
It has to be neutral. An example of this would be payments. It doesn't matter who the source is or who the destination is, it just routes from one end to the other. This neutrality is a critical requirement for freedom and very rapid innovation. It allows new capabilities to be developed quickly and efficiently.
It has to be censorship-resistant, meaning that no one should be able to stop a transaction from happening, whether that's a payment or some other form of transaction, or block people from participating in the system. That it should be resistant does not mean censorship proof. You can shut down parts of it. You can deny or disrupt access to parts of it some of the time. You can't disrupt all of it all of the time, just like the Internet.
It has to be private. Privacy is key when it comes to payments—without it, the other features of payment become weak. For example, if you don't have sufficient privacy, then you can't prevent a transaction from happening, but you can be punished for it afterwards. So if there's public information about a million pounds being deposited into my account, that's not safe. I'll give you an even simpler example: if I send money to an Iranian citizen, I'm breaking both State Department and Treasury rules. It's a crime. And that must be verified. However, if you buy an inhaler from the Silk Road or something that is perfectly legal in your home country but illegal in another country with which you have an association or visit later, that is a privacy concern. Privacy is important in free countries because it is a fundamental human right, but it is even more important in non-free countries because your life can be easily disrupted by financial control.
I strongly believe that this project is not only needed but it's achievable. I am, however, aware that it might be difficult to achieve because of the centralization of the current global financial system. With that being said, we will look at what works and doesn't work while building the project so that we can come to a compromise that benefits everyone involved. I see a future where someone in Africa can receive payments from anywhere in the world without having to resort to illegal means or pay heavy fees and exchange rates just to access their funds.
Keep an eye out for a more comprehensive article that will go into detail about what the project is all about, its features, and functionalities. Hopefully, it will have a better name than CryptoPaypal! If you enjoyed reading this article, please be sure to like and share it with your friends.