PayPal to Launch Cryptocurrency Payment Services in 2021
PayPal is set to allow users to make transactions using cryptocurrencies, according to multiple reports today.
According to a press release on Reuters, users will be able to use cryptocurrencies starting in early 2021. PayPal believes that the new service would encourage the global use of virtual currencies. Also, it hopes to prepare its payment network for the new CBDCs that will be issued by central banks globally.
US account holders will be the first to experience this new service in the coming weeks. The global payment giants plan to expand to Venmo and other countries in the first half of 2021.
PayPal revealed that crypto payments to merchants on its platform would be settled using fiat currencies. This is due to the volatile nature of cryptocurrencies and slow transaction times for assets like Bitcoin.
PayPal CEO Dan Schulman revealed that the company was in discussions with Central Banks on digital currencies.
“We are working with central banks and thinking of all forms of digital currencies and how PayPal can play a role,” he said.
Paxos to power Crypto Payments for PayPal
PayPal will be partnering with Paxos Trust Company to offer crypto payment solutions to US customers. Paxos revealed in a press release that its platform had integrated PayPal’s API, and users will be able to purchase Bitcoin, Ethereum, Bitcoin Cash, and Litecoin.
The crypto trading platform also stated that PayPal had received a conditional virtual currency license from the New York State Department of Financial Services. Paxos is a fully licensed crypto platform that offers crypto services in the United States.
Huge news for the Crypto Adoption
PayPal’s foray into the crypto space is a huge one for the adoption of crypto assets mainstream. The California-based company has over 300 million users globally, making it among the most popular payment platforms. In the second quarter, it processed $222 billion in payments.
The addition of crypto payments on its platform further increases the reach of crypto assets like Bitcoin. It also enables users to convert their PayPal earnings easily to crypto-assets and vice versa.
With this development, PayPal will be joining other fintech firms like Square and Robinhood Markets Inc to offer crypto payment services on its platform.