Bitcoin vs PayPal

People often put Bitcoin and PayPal in the same mental bucket. Both move money digitally. Both work on a phone. Both don’t require cash.

But comparing them is like comparing email to the post office. One is a protocol — a set of rules anyone can build on. The other is a company — a business with shareholders, terms of service, and the power to close your account.

PayPal is a company. It was founded in 1998, has a CEO, employs thousands of people, and answers to regulators and shareholders. It can freeze your account with no warning. It has done this to sex workers, political activists, journalists, and ordinary people who violated its terms of service — sometimes by mistake. It charges fees. It takes days to settle international transfers. It doesn’t operate in dozens of countries.

Bitcoin is a protocol. Like the rules of chess or the laws of mathematics, it doesn’t have a headquarters or employees. Nobody can be fired. Nobody can change the terms. Nobody can freeze your Bitcoin without physically taking your device and knowing your password.

When you use PayPal, you’re asking permission to use someone else’s system, under their rules, at their discretion.

When you use Bitcoin, you’re using a system that belongs to no one — and therefore cannot be taken from you by anyone.

For routine purchases between people who trust the system, PayPal is fine. But for anyone who has ever had a payment blocked, an account frozen, or been denied access to their own money — the distinction is everything.

Tomorrow: the number that changes everything. 21 million.

— The Daily Bit