PayPal patent could speed up cryptocurrencies

Online payments giant PayPal has just filed a patent that could give cryptocurrency speeds a boost.

Details of the new technology are revealed in a patent filing published last week.

The idea behind the tech would mean transferring private keys outside of the blockchain to speed up processing times.

Such a system could massively reduce transaction times.

Adoption of this type of solution would be great news for cryptocurrencies, especially Bitcoin which has become slow and expensive compared to other cryptos.

The company says in its patent filing that it hopes to reduce the time-delays associated with virtual currency transactions, saying:

“Virtual currencies like Bitcoin have revolutionized money transfer and payment technology by allowing for inexpensive peer-to-peer transfer of value between users.

“However, the decentralized nature of such virtual currencies is accompanied by a need to confirm transactions, and those confirmation processes introduce a time delay or latency period between the initialization of the transaction and the point at which the transaction has been confirmed.”

Speed up Bitcoin

Bitcoin has been plagued with slow transaction times, but this patent aims to solve those issues.

Speed up Bitcoin

Bitcoin has been plagued with slow transaction times, but this patent aims to solve those issues.

Major credit card networks process an estimated 50,000 transactions a second globally.

In comparison, Bitcoin does approximately seven per second.

PayPal’s system involves using a secondary wallet that uses keys tethered to predefined amounts of virtual currency.

The patent explains that it would function by transferring private keys outside of the blockchain to boost times:

The systems and methods of the present disclosure practically eliminate the amount of time the payee must wait to be sure they will receive a virtual currency payment in a virtual currency transaction by transferring to the payee private keys that are included in virtual currency wallets that are associated with predefined amounts of virtual currency that equal a payment amount identified in the virtual currency transaction.

Set new records

The “Lightning Network” utilizes a similar strategy to this by making Bitcoin transfers through channels.

Developers of the Lightning Network claims it’ll one day be able to process billions of transactions per second.

Should these new systems flourish, Bitcoin could finally enter mainstream into usage.

Such mass adoption would see the value of the world’s leading crypto shoot past its mid-December price high of nearly $20,000 to set new records.