PayPal Wants to Create an NFT Marketplace

PayPal has filed a patent application that aims to revolutionize the buying and selling of nonfungible tokens (NFTs). The patent application, filed in March, was unveiled on Sept. 21.

The patent unveils a unique structure: transactions with NFTs can be routed through an unnamed third-party service provider, although Ethereum is cited in the application. 

PayPal’s proposed ecosystem showcases flexibility. Fractionalized NFT purchases, for example, seem to be a possibility, leading to the circulation of governance tokens that can be traded. 

Furthermore, a decentralized autonomous organization tied to the service provider might be leveraged to enhance NFT liquidity on a dedicated platform.

The application also revealed that the scope of the pending patent isn’t just limited to digital collectibles, but to anything that represents distinguishable digital data, which can also be tracked through a decentralized blockchain ledger. 

Off-Chain Transactions

The illustrated diagrams in the application also show another feature – an “omnibus wallet,” which would be directly linked to the service provider. For these types of transactions, no transfer would be registered on the blockchain, nor would there be any associated gas fees. 

PayPal’s vision also entertains the concept of NFT-generated income through royalties. For users’ convenience, a third-party could offer storage and checkout services, while compliance and risk management could be streamlined by the service provider.

Highlighting the versatility of the proposed system, the application notes that any currency can be utilized. 

In early August, PayPal also announced its new dollar-backed stablecoin, PayPal USD ($PYUSD), which marked the first time a major U.S. financial company created this type of digital asset. 

New Leadership

Back in August, PayPal’s Board of Directors announced that it would be appointing Intuit executive, Alex Chriss, as the company’s new President and CEO, this month. 

Chriss has served as Intuit’s Executive Vice President and General Manager of the company’s Small Business and Self-Employed Group since 2019, and is responsible for more than half of Intuit’s revenue. In 2021, he led Intuit’s successful $12 billion acquisition of Mailchimp. 

Editor’s note: This article was written by an nft now staff member in collaboration with OpenAI’s GPT-4.