[acdha]

If that were true, PayPal would be able to generate an easy profit by saying “PayPal bucks” are worth $0.80. They have the ethics to do that but they don’t because they do in fact keep their books in real currency and if you transfer $100 USD they have a legal obligation to give you that amount.

What it’s not is an FDIC insured bank, so if they make a huge mistake you’ll be one of millions of people making claims against whatever assets they have left.

[schoen]

> PayPal would be able to generate an easy profit by saying “PayPal bucks” are worth $0.80.

Though that would be extremely harmful to their ongoing business because it would make funds transfers have a phenomenally high overhead.

[jjav]

> if you transfer $100 USD they have a legal obligation to give you that amount

I don't think they have any legal obligation, given the large number of times they have decided to simply keep people's money and never return it for no discernible reason.

Sure, most of the time for most people you can get the money out just fine, but no guarantees with paypal (venmo, etc).

[acdha]

They wouldn’t need the terms of services clauses they’ve cited in those cases if they could just say “we have no obligation to give you the same amount as we received”.

[Alupis]

They already do this, just not for "friends & family". That's part of the hook to get so many people to sign up and use it, making it a huge value-add for businesses.

Any sort of business transaction pays fees, making $1 equal roughly $0.97.

[arcticbull]

Absolutely not, the balance is net of transaction fees and the fees are removed and segregated.

[Alupis]

This is a distinction without a difference.

The business sells a product for $100, and receives $97 for it...