As interest rates go up, PayPal will benefit by holding people's money longer for "verification" purposes or whatever. They make some money on fees, but probably a lot more on the interest for short term deposits. Since they seem to have carte blanche in terms of policies to control the flow of users' money through their hands, it seems a great business until there is a mass exodus of users. Since they are now in cahoots with the IRS, fat chance any competitors of scale will emerge soon.

As a business model, evil and profitable. As a stock, well, this is a casino.