On September 25, PayPal announced a major expansion of its cryptocurrency services. U.S. businesses can buy, hold, and sell cryptocurrencies directly from their PayPal business accounts. This move marks a significant shift for the company, which has offered similar services to private users through PayPal and Venmo accounts since 2020.
Jose Fernandez da Ponte, PayPal’s Senior Vice President of Blockchain, Crypto, and Digital Currencies, explained that the decision to extend these capabilities to businesses was driven by rising demand from entrepreneurs seeking the same cryptocurrency functionality as consumers.
“Business owners have increasingly expressed a desire for the same cryptocurrency capabilities available to consumers. We’re excited to meet that demand,” he stated.
In addition to the core features, PayPal will allow U.S. merchants to transfer cryptocurrencies to eligible third-party wallets. It offers greater flexibility in managing digital assets. However, crypto services will not be available initially to businesses in New York, a state with stringent cryptocurrency regulations. PayPal has not yet provided a timeline for potential inclusion in the New York market.
See Related: PayPal Partners With MoonPay To Take Crypto Mainstream In The US
Paypal Introduces Its Own Stablecoin
In August 2023, PayPal launched its stablecoin, PYUSD, fully backed by U.S. dollar deposits and is redeemable at a 1:1 ratio with the dollar.
PYUSD is designed for everyday transactions and has since expanded to the Solana blockchain due to Solana’s lower transaction costs. The integration on Solana also introduces “confidential transactions,” obscuring payment amounts for privacy while maintaining visibility for regulatory purposes.
Despite its growth to a $1 billion market cap, PYUSD still trails behind market leaders like Tether ($118 billion) and Circle’s USDC ($35 billion) as of August 2024.
