Ever since the initial murmurings and quietly published patents from back in 2014/15, many had been wondering when paypal would finally take the dive into the emerging world of cryptocurrencies. Well that time has come with the company announcing that it is launching a new service enabling users to buy, hold and sell cryptocurrency.
The migration toward digital payments and digital representations of value continues to accelerate, driven by the COVID-19 pandemic and the increased interest in digital currencies from central banks and consumers.
According to Onchain bitcoin analyst, Willy Woo and data complied by Glassnode there are ~187M+ Bitcoin users. Comparatively Paypal has a reported user base of 346M+users as of Q2 2020, this represents a sizeable increase in awareness and people from within the retail sector, with quick and easy access to purchase Bitcoin and Litecoin.
To increase consumer understanding and adoption of cryptocurrency, the company is introducing the ability to buy, hold and sell select cryptocurrencies, initially featuring Bitcoin, Ethereum, Bitcoin Cash and Litecoin, directly within the PayPal digital wallet. The service will be available to PayPal accountholders in the U.S. in the coming weeks. The company plans to expand the features to Venmo and select international markets in the first half of 2021.
Whilst the inital product offering is limited to buying, selling or holding to those strictly within the US for now. Paypal has stated its intentions to roll out its cryptocurrency offering to its 26M+ merchant network.
Beginning in early 2021, PayPal customers will be able to use their cryptocurrency holdings as a funding source to pay at PayPal’s 26 million merchants around the globe. Consumers will be able to instantly convert their selected cryptocurrency balance to fiat currency, with certainty of value and no incremental fees. PayPal merchants will have no additional integrations or fees, as all transactions will be settled with fiat currency at their current PayPal rates. In effect, cryptocurrency simply becomes another funding source inside the PayPal digital wallet, adding enhanced utility to cryptocurrency holders, while addressing previous concerns surrounding volatility, cost and speed of cryptocurrency-based transactions.