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PayPal announced that it is now letting US merchants buy, sell and hold Bitcoin and cryptocurrencies directly from their PayPal business accounts. The new capabilities, however, will not be available for users in New York, the company said.
As demand for expanded cryptocurrency capabilities is on the rise, PayPal decides to bring up new offerings.
Jose Fernandez da Ponte, Senior Vice President of Blockchain at PayPal, said that since the company rolled out features allowing users to buy and sell cryptocurrencies within their existing PayPal and Venmo accounts, it has the opportunity to observe and analyze user behavior.
PayPal Opens The Door For Crypto Business
The new feature was a result of the insights PayPal has got. It aims to address the growing demand among business owners for cryptocurrency functionalities, according to da Ponte. PayPal expects the feature to help businesses interact with cryptocurrencies with ease.
“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,” da Ponte stated.
Alongside the offering, PayPal also enables businesses to transfer their cryptocurrencies to “third-party eligible wallets.” This allows them to send and get tokens to and from external blockchain addresses like cold storage wallets, which could help enhance security.
PayPal’s Continued Cryptocurrency Efforts
Over the past few years, PayPal has made strides in its cryptocurrency efforts, focusing on expanding its services and enhancing user engagement with digital currencies. The ease of access provided by the online payment giant has attracted both new and existing customers interested in digital assets.
Letting users buy, sell, and hold cryptocurrencies like Bitcoin, Ether, or Litecoin is seemingly the beginning of a long-term vision. In 2023, PayPal made an important move as it announced the launch of PayPal USD (PYUSD), PayPal’s flagship stablecoin.
Issued by Paxos Trust, PayPal’s stablecoin is fully backed by U.S. dollar deposits, short-term U.S. Treasuries, and similar cash equivalents. It can be redeemed 1:1 for U.S. dollars. PYUSD operates as an ERC-20 token on the Ethereum blockchain and aims to facilitate seamless transactions within the PayPal ecosystem and beyond.
The company later launched PYUSD on the Solana blockchain to enhance transaction speeds and reduce costs. The integration also introduces features like “Token Extensions,” which improve privacy and compliance for merchant transfers—capabilities not available on Ethereum.
PYUSD supports person-to-person payments and can be used for purchases at millions of merchants. The stablecoin also allows for conversions between PYUSD and other supported cryptocurrencies.
Tether’s USDT currently dominates the stablecoin sector with its market value hitting $119 billion. Circle’s USDC takes second place. As of September 25, PYUSD’s market cap exceeded $703 million, per CoinGecko. Despite increasing competition in the stablecoin market, PYUSD, backed by one of the leading payment platforms, still has a potential to grow more.
Apart from stablecoin offering, PayPal and Venmo have recently integrated the Ethereum Name Service (ENS) to facilitate cryptocurrency payments. The move aims to simplify the transaction process as it allows users to send and receive crypto using human-readable ENS names instead of complex wallet addresses.
Users can enter an ENS name when making a crypto transfer on either platform. PayPal’s system will automatically resolve the ENS name to the corresponding wallet address, reducing the risk of errors associated with manually entering long alphanumeric addresses.
PayPal and Venmo also introduced an Address Book feature that enables users to save frequently used ENS names and wallet addresses for quicker future transactions.
PayPal plans to expand its cryptocurrency offerings in the future, which could include potential developments in decentralized finance (DeFi) and exploring additional blockchain technologies that could enhance transaction efficiency and security.
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