PayPal has made significant progress in creating its own blockchain ecosystem by filing a patent application for a non-fungible token (NFT) purchase and transfer system. The application was submitted in March, publish On September 21, a method of using NFTs for on-chain and off-chain transactions was described.
The patent application, which is still pending, describes a system where users can buy and sell NFTs through a third-party service provider. Although Ethereum is mentioned in the article, the provider is not specified.
Related: PayPal allows US users to sell cryptocurrencies through MetaMask wallet
PayPal envisions harnessing the full potential of NFTs for tokenization, reaching far beyond the exchange of electronic collectibles:
“An NFT in this example could represent any unique digital data that can be tracked using a decentralized blockchain ledger. (…) Examples of such assets include (…) digital images and videos, music, collections and other digital artwork, as well as personal property deeds, event tickets, legal documents, and other real-world items.”
The system can be customized in a variety of ways. For example, it could accommodate decentralized purchases by managing the distribution of tokens, which can then be traded on their own. In addition, “Decentralized Autonomous Organizations (DAOs) associated with service providers can be used to facilitate NFT liquidity through dedicated platforms.” NFTs can also earn revenue from royalties.
Processing by service providers may include compliance and risk management. Users can have their own digital wallet, but it is not required. Third-party brokers may offer various storage and checkout services as alternatives. Off-chain transactions can be processed within an “integrated wallet” associated with the service provider and containing the buyer’s and seller’s wallets:
“As a result, no transfers will be registered on the blockchain, and there will be no need to broadcast transactions to the blockchain network or pay gas fees associated with such on-chain transactions.”
Depending on the application, any currency can be used in the system. PayPal launched its own stablecoin, PayPal USD (PYUSD), in August, which is based on Ethereum.
this is the first day @PaypalPresident and CEO. I’m excited to join a team with a powerful mission and a remarkable history of revolutionizing the way millions of people around the world take control of their financial lives. PayPal team, let’s change the world together! pic.twitter.com/PIZuY8iKn2
— Alex Chris (@acce) September 27, 2023
Magazine: Tokenizing music royalties into NFTs could help the next Taylor Swift
Svlook
