Let’s cut the polite fintech nonsense.
You think you’re using PayPal to make your life easier. Quick payments, smooth interface, instant transfers. But here’s the truth no one spells out:
You’re not using PayPal. PayPal is using you.
The Illusion of Control
When you move money into your PayPal account, it feels like you still own it, right? After all, it shows up in your balance. You can see the number. You can send it to friends or pay for stuff online. It’s your money.
Except it’s not.
Legally, the funds you deposit into PayPal are held in custodial bank accounts owned by PayPal (not you). That means they control where it goes, how it's stored, and—most importantly—how it earns interest.
And spoiler: you don’t get a cent of that interest.
But Wait, It Gets Better (Worse)
As of late 2024:
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PayPal has 434 million users.
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It processed over $1.68 trillion in total payment volume.
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It earned approximately $148 million in interest income in just one quarter (Q4 2024).
That’s not from selling a product. That’s not from innovation. That’s from parking your money and letting it quietly make them rich while you sit there thinking you’re being smart.
This isn't a conspiracy. It's right there in their terms: funds are invested in liquid assets; users are not entitled to interest.
Why Do People Still Use It?
Because it feels easy.
Because the app is smooth, the buttons are shiny, and the notifications are friendly.
Because we’ve been trained—by years of marketing and habit—to trade control for convenience.
And because somewhere along the way, we started believing that if something is digital, sleek, and fast… then it must be safe and fair.
But it’s not.
It’s the same old banking game, just dressed up with emojis, animations, and “Send Money” buttons.
How the Sc4m (Sorry, Business Model) Works
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You transfer $500 to PayPal.
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That $500 goes into their custodial bank account.
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You get a pretty interface that says "$500 available."
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Behind the scenes, they invest that money and make passive returns.
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You try to withdraw it?
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ACH is slow.
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Instant withdrawals have a fee.
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Meanwhile, your money is doing nothing for you.
The Power of Friction
Traditional banks at least pretend to pay interest. Fintech wallets like PayPal cut you out of the deal entirely, while masking it behind frictionless UX and emoji-filled emails.
It’s not financial innovation. It’s financial extraction.
The Bottom Line
PayPal isn’t a tool. It’s a trap.
A beautiful, convenient, modern trap.
So next time you check your balance and smile, ask yourself:
Who's really making money here?
(Hint: Not you.)
Want a better deal?
Look into wallets or protocols that actually pay you to hold, not punish you to move.
Let me break that down:
When you keep your money in PayPal, you're doing them a favor.
They use your funds, earn interest, and give you nothing back.
Worse: if you want your money fast, they charge you for that too.
Now compare that to modern crypto wallets and DeFi protocols:
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You hold stablecoins (like USDT, USDC, or DAI).
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You deposit them into platforms like Aave, Compound, or Molecula.
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Your money is used in transparent lending pools.
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And you get the interest — not the middleman.
It’s the same $500.
But instead of sitting still, it’s working for you, not for someone else.
No hidden fees.
No delays.
No emoji-filled lies.
Just real ownership, real returns, and no bank in the middle.
PayPal gives you convenience but takes control. While you see a balance, they’re investing your money and making millions. That’s not financial innovation — it’s extraction. If you want real benefits, use tools that pay you to hold, not charge you to move. It’s your money.
Act Like it!
