Highlights:
- PayPal lets U.S. merchants buy, hold, and sell digital assets directly from accounts.
- New cryptocurrency features will not be available for business accounts in New York.
- PayPal’s stablecoin initiatives position it for significant growth in digital assets.
On September 25, payment giant PayPal revealed that U.S. merchants can now buy, hold, and sell crypto directly from their business accounts. The company also allows US business account holders to transfer cryptocurrency to eligible third-party wallets and receive supported tokens from external addresses. However, the company said the service will not be available for business accounts in New York.
Advertisement
PayPal business account holders can now buy, sell, and hold cryptocurrency within their accounts. This is the next step for more PayPal users to explore and use #cryptocurrency! Learn more: https://t.co/YZSov4tkOU
— PayPal For Business (@PayPal4Business) September 25, 2024
PayPal Expands in the US to Meet Growing Demand in the Crypto Industry
This move reflects the growing interest among business people in utilizing digital currencies for business and investment purposes. Jose Fernandez da Ponte, PayPal’s SVP of blockchain, cryptocurrency, and digital currencies, mentioned that this new feature allows small business owners to engage with digital assets easily
He stated:
“Business owners have increasingly expressed a desire for the same cryptocurrency capabilities available to consumers. We’re excited to meet that demand by delivering this new offering, empowering them to engage with digital currencies effortlessly.”
PayPal Joins the Stablecoin Market
PayPal’s decision to allow U.S. merchants to send and receive cryptocurrency follows its launch of several initiatives. These efforts are aimed at capturing market share among companies and customers in the digital assets industry.
In August 2023, PayPal introduced the PYUSD stablecoin. The PayPal-United States Dollar stablecoin, issued by Paxos, is fully overcollateralized, meaning U.S. dollar deposits and short-term cash equivalents back it. PYUSD is completely redeemable at a 1:1 ratio with the U.S. dollar. According to CoinGecko, the token ranks as the 109th largest digital asset, with a market cap exceeding $712 million.
The payments company later expanded PYUSD to the Solana network, highlighting Solana’s significantly lower transaction costs. PayPal aims to encourage the use of PYUSD for smaller purchases, such as coffee or lunch at a restaurant, by taking advantage of these reduced costs.
Typically, smaller purchases are challenging on lower-throughput blockchains due to higher fees and slower finality times. For instance, a transaction on Solana can cost as little as $0.0025, while transactions on Ethereum may reach double-digit amounts, particularly during periods of network congestion.
The Payment Giant Targets New Crypto Partnerships
Last month, Crypto.com partnered with PayPal to facilitate cryptocurrency purchases. This service allows users to transfer funds from PayPal to Crypto.com and buy crypto tokens by linking the wallets of both platforms. The companies also announced plans to extend this feature to markets outside the U.S. soon.
Additionally, MoonPay teamed up with PayPal to introduce a crypto purchasing option for U.S. cryptocurrency app users. This service enables users to conduct transactions through PayPal via wallet transfers, bank transfers, and debit cards. It aims to streamline cryptocurrency buying and trading by bridging traditional financial services with the crypto space.
The announcement highlights that the collaboration between MoonPay and PayPal represents a major step toward mainstream cryptocurrency adoption. Through MoonPay, PayPal users gain access to a broader selection of digital assets. Additionally, PayPal secured FCA approval to offer digital asset services in the United Kingdom.
Advertisement
