Can Solana Replace PayPal?


Since 1998, PayPal (PYPL 5.21%) has helped pioneer electronic payments, making it easier for users to send and spend money.

The company has launched a slew of new product options for its user base, which now stands at 429 million active accounts as of June 30.

But Solana (SOL 2.91%), an unique cryptocurrency with crucial features, could hurt the top fintech stock over time. 

PayPal executed 20.9 billion transactions for a total payment volume (TPV) of $1.3 trillion in the preceding 12-month period as of the second quarter of 2022.

During that time, the company earned $26.4 billion in revenue. This is one of the most significant businesses in the payments industry.

PayPal charges fees for each transaction on its network. In the last quarter, the average transaction take rate was 1.85%, down from the preceding year.

Solana, like Ethereum after The Merge, employs a proof-of-stake consensus mechanism.

But Solana's pace sets it apart. The blockchain can handle 50,000 transactions per second (TPS) almost for free.

Solana Pay has 600 users. If Solana Pay can improve the user experience for consumers and merchants and offer value, it will succeed in the payments sector.

There's no doubt that Solana has the potential to garner widespread acceptance, particularly in payments, which is PayPal's forte.