After the revelation of its future terms of use, PayPal underwent a large unsubscription movement. Since then, the US company has backtracked, leaving behind a bitter taste of censorship for its customers. What created the controversy
The origins of the scandal
Last weekend, online payments giant PayPal found itself at the centre of an intense controversy. At issue was the fact that its future terms of use explicitly favoured the use of censorship against its customers.
According to this document, anyone who does not respect PayPal’s rules of use could be fined up to 2,500 dollars, deducted directly from the user’s account. In the words of the file:
“Violation of these terms of use constitutes a breach of PayPal’s user agreement and may subject you to damages of up to $2,500 per violation, which may be deducted directly from your PayPal account […]. “
In the same document, the American company specified that it could apply its fine “by its own judgment”. Without going into the details of the legal nature of such a measure, the company had therefore taken a position in favour of a potential censorship applicable to its users.
BREAKING: PayPal will steal all your money if you send, post, or publish “any messages, content, or materials that, in PayPal’s sole discretion, (a) are harmful, obscene, harassing, or objectionable”. pic.twitter.com/tB6B3lbidF
– Matt Orfalea (@0rf) September 30, 2022
PayPal will steal all your money if you send, post, or publish “any messages, content, or materials that, in PayPal’s sole view, are harmful, obscene, harassing, or objectionable.
This situation is a reminder of the censorship power acquired by large corporations, where decision-making is centralised. Indeed, it was in an attempt to combat this centralisation that the cryptocurrency Bitcoin was born.
PayPal is putting the brakes on
After the publication of these new terms of use, which were to come into effect from 3 November 2022, a wave of unsubscribes hit the platform. On Twitter, many users posted screenshots showing their unsubscription to the American company’s services.
For his part, David Marcus (former president of PayPal) stated his opposition to the new rules desired by PayPal:
The new PayPal rules go against everything I believe in. A private company can now decide to take your money if you say something you disagree with. This is insane. “
After a few hours of media storm, the company finally responded to its opponents. According to a press release, PayPal claims that the document containing its future terms of use was “a mistake”. Furthermore, the payment company stresses that it “never intended to include these rules” in its terms of use.
Nevertheless, for many Internet users, the pill is hard to swallow. Some wonder how a document of several pages could have been written and published accidentally. In other words, whether the mistake was intentional or not, the company has lost the trust of its customers.
Is PayPal’s legacy secure?
The PayPal scandal is a warning from internet users against centralized companies. In recent years, cryptocurrencies have emerged as an alternative to these institutions. As a result, economic players in the technology sector are all concerned about Web3-related issues.
PayPal is known to have been the entrepreneurial breeding ground of Web2. We can name:
- The founders of YouTube (Chad Hurley, Steve Chen, Jawed Karim);
- One of the co-founders of LinkedIn (Reid Hoffman);
- Square’s COO (Keith Rabois);
- The CEO of Tesla and SpaceX (Elon Musk).
Some players have already taken positions in the cryptocurrency sector. Despite its recent controversy, PayPal has been embracing cryptocurrencies for almost 2 years. For his part, Elon Musk is known for his ambivalent attitude towards Bitcoin.
In other words, Web3 seems to be an essential component of the future of the Internet: whether it is PayPal or banking institutions as a whole, all of them will have to adapt to meet the new needs of freedom, desired by a growing part of the population.
