How PayPal Almost Liberated Cyprus

If you think PayPal holds are a real bummer, just imagine how the people of Cyprus must feel. Gerald Celente of the Trends Research Institute had been warning of "Economic Marshal Law" and a "Banking Holiday" such as that seen over in Cyprus this past week. The Cyprus government isn't just going to put holds on depositors money...they aren't going to give it back in many cases.

But believe it or not, the brains behind the PayPal Hold could have been the same ones to liberate the people of Cyprus. PayPal's original vision was to avert this type of crisis from shocking depositors of local currencies around the globe.

Eric M. Jackson's book "The Paypal Wars" published in 2004 describes how the PayPal option could have played out:

"In the future, when we make our service available outside the U.S. and as Internet penetration continues to expand to all economic tiers of people, PayPal will give citizens worldwide more direct control over their currencies than they ever had before. It will be nearly impossible for corrupt governments to steal wealth from their people through their old means because if they try the people will switch to dollars or Pounds or Yen, in effect dumping the worthless local currency for something more secure... It was this potential that made Confinity's (PayPal's) vision of "world domination" which might have been more appropriately called "world liberation"-all the more credible. ... Whenever this scenario played out, the citizens of these countries especially the poor and middle class, who seldom had access to offshore banking options were always hit the hardest. If PayPal could find a way to empower these people to move and transfer money with the click of a mouse, then we would indeed be on the verge of creating something far more revolutionary than just a new way to split up dinner bills."

Although PayPal has been an option for Cyprus, there has been little if any public discourse or press on the "PayPal Option." Though one Twitter user located in Ireland did seem to be able to make Cyprus money transfer using PayPal:

Anton Sutton‏ (@anton_sutton)

#cyprus bail hack: you can still transfer money out of Cyprus using PayPal and your BoCY debit card. Tried it and transaction went through.

5:58 AM - 21 Mar 2013

Another publication from 2004, this time from the International Monetary Fund, explains how PayPal is not a currency: 

"...the new e-money that has been created on the Internet to date is actually government e-money. As an illustration, consider the services provided by PayPal (www.paypal.com). This service enables the user to send a payment to anyone with a PayPal account or an email address. The payments are made in U.S. dollars or in one of the other currencies that PayPal chooses to deal in. While PayPal makes payments using e-money, the e-money is not private. PayPal works through the banking system, because any payment that moves through PayPal must enter and exit PayPal's system either though an electronic bank transfer or through a credit card payment, which is also an electronic bank transfer. Thus, PayPal is conducting e-banking (payment) services using government e-money, not private e-money."

Enter BitCoin

Wikipedia describes BitCoin as "...a decentralized digital currency based on an open-source, peer-to-peer internet protocol. It was introduced by a pseudonymous developer named Satoshi Nakamoto in 2009."

Fast forward to the 2013 Cyprus crisis. All the press has been going to BitCoin with such headlines as "Cyprus Crisis Boosting Unique Currency, the Bitcoin," "Bitcoin ATM To Open in Cyprus," "Spooked by Cyprus, Spaniards Shield Assets in Bitcoin" and "Digital currency value skyrockets in wake of Cyprus crisis."

In particular "Bitcoin: Virtual Currency Enters Real World" from Bloomberg news, which states, "Welcome to the real world, Bitcoin. The U.S. government has officially legitimized the popular crypto-currency and other "virtual currencies" by attempting to regulate them."

Do you have friends or family in Cyprus? Did they use PayPal or BitCoin to help them during this crisis? Let us know below.

About the Author
Brian Cohen has been an active member of the eBay community since May 1998. He currently trades under the member name Bidofthis.com. His first AuctionBytes article was published in May 2002. Brian can be contacted through his website at BidofThis.com where he always has a "little Bid of This and little Bid of That."

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