PayPal Opens Crypto Payments

A spokesman for PayPal said in an emailed statement, “As we further develop our product offerings, we may determine it appropriate to hold certain balances of crypto  for operational  purposes. However, we are not yet at a point that we believe this is necessary.”

article-image

SOURCE: SHUTTERSTOCK

share

key takeaways

  • PayPal framed the offering as a “new way for businesses to get paid.”
  • Paxos Trust Company handles all the trading and custody of PayPal customers’ cryptocurrency balances.

PayPal opened its Checkout with Crypto product to US customers Tuesday, allowing them to purchase items online using digital assets held in their PayPal wallets.

PayPal framed the offering as a “new way for businesses to get paid” and a way to add utility to cryptocurrency for its holders, according to a press release Tuesday. Although, while digital cash was the initial vision for bitcoin, that use case hasn’t yet taken off as merchants largely don’t want to take on the risk of its price volatility and cryptocurrency holders largely prefer to hold onto it as the price climbs higher.

Consistent with those trends, when customers use Checkout with Crypto, they sell their crypto and use the proceeds of the sale to pay for their purchases. Merchants are paid in dollars.

“We have no plans to purchase crypto  for investment or cash management purposes at this time,” a spokesman for PayPal said in an emailed statement when asked if PayPal had plans to hold bitcoin on its balance sheet. “As we further develop our product offerings, we may determine it appropriate to hold certain balances of crypto  for operational  purposes. However, we are not yet at a point that we believe this is necessary.”

Paxos Trust Company handles all the trading and custody of PayPal customers’ cryptocurrency balances. 

PayPal has 361 million consumer accounts and 29 million merchants in its global network. It began supporting bitcoin, ether, litecoin and bitcoin cash trading in October, when it first announced customers would soon be able to use their digital assets to pay for purchases from PayPal merchants.

More importantly, company’s new Crypto unit is laying the groundwork for the near-future implementation and use of central bank digital currencies. The company has also acquired the Israeli custody startup Curv as part of its digital wallets strategy.

“You think about how many [digital wallets] we’re going to have in the next two, three or five years, and we’re a perfect complement to central banks and governments to distribute those digitized forms of currency,” he said in the company’s fourth quarter earnings presentation last month. “This is a once in a multi-decade opportunity where the fundamental rails of the system are going to be redefined and we have a chance to help shape that.”

This is a developing story.

Tags

Upcoming Events

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Screen Shot 2024-05-16 at 14.53.45.png

Research

Loss-versus-rebalancing (LVR) is arguably Ethereum DeFi’s biggest problem, and thus reducing LVR is fundamental to the success of Ethereum. This report dives into the world of LVR. We uncover its importance for AMM designers, discuss the two major mechanism design categories and various projects developing solutions, and offer a higher level perspective on the importance of AMMs in general.

article-image

The courts adjourned the trials against Binance and Tigran Gambaryan until May 22 and May 23

article-image

Industry players have started realizing high-performance computing-related revenues as they buy Nvidia GPUs and secure customer deals

article-image

Yesterday saw Congress’ upper chamber side with the House on a measure aimed at overturning SAB 121

article-image

Oklahoma’s new crypto bill will go into effect in November of this year

article-image

The deposits hit a $20 million cap in just 45 minutes

article-image

Twelve Democratic Senators voted in favor to pass the resolution Thursday