PayPal Launches Crypto Trading Services for Merchants in the United States

Leading financial services corporation PayPal now permits businesses in the U.S. with accounts on its platform to purchase, sell, and store cryptocurrencies directly within their PayPal accounts.

The eminent payment company PayPal has introduced upgraded functionalities that empower business account holders in the U.S. to engage with cryptocurrencies by buying, selling, and holding them within their accounts.

This initiative reflects PayPal’s commitment to cater to the increasing interest of its business clientele in the cryptocurrency services once restricted to individual users. The company is also paving the way to incorporate these crypto services into everyday business activities but noted that these services would not be accessible in New York State due to regulatory reasons.

Introduced on PayPal’s subsidiary platform Venmo in 2020, cryptocurrency management has seen a widening footprint, with PayPal steadily enhancing the accessibility and integration of cryptocurrencies into their services according to a recent announcement.

Jose Fernandez da Ponte, senior VP of blockchain, cryptocurrency, and digital currency at PayPal, conveyed the excitement about this new feature: “We’re committed to fulfilling the growing needs of our business owners by providing them a seamless way to work with digital currencies.”

These newly launched features are aimed at augmenting the practical use of cryptocurrencies for business purposes, responding to a surge in demand for such facilities from entrepreneurs following the debut of PayPal’s consumer-level crypto offerings.

Fernandez da Ponte further stated, “The facility to buy, sell, and hold cryptocurrencies that we first offered to PayPal and Venmo users taught us much about their usage preferences.”

Clearly resonating with investor confidence, PayPal shares have seen a significant 26% upward trajectory this year.

Cryptocurrency On-Chain Transfers to External Wallets Now Possible for Businesses

Businesses in the U.S. now also have the capacity for transferring cryptocurrencies to wallets that exist outside the PayPal system, exemplifying the expanded versatility in digital currency dealings for commercial users.

“We’ve now enabled our business account holders to initiate cryptocurrency transactions to and from external blockchain wallets,” PayPal specified in their public statement.

In recent developments, PayPal found a partner in Crypto.com joining forces to allow U.S. consumers to pay with cryptocurrencies. This collaboration builds on the companies’ previous cooperative efforts, such as enabling the Crypto.com Visa Card to be funded via PayPal. PYUSD, PayPal’s stablecoin, also circulates on selected exchanges like Coinbase, Bitstamp, and Kraken.

Expansion of PYUSD to Solana Leads to Lower Fees for PayPal

In 2023, PayPal introduced its native stablecoin, PYUSD, which Paxos Trust Company, a U.S.-regulated firm, issues. PYUSD debuted on the cryptocurrency landscape as an ERC-20 token using Ethereum’s blockchain.

To address the high transaction costs associated with Ethereum-based stablecoins, PayPal incorporated PYUSD into the Solana network in May 2024, which led to a substantial cut in transaction fees, in many cases by over 90%. These reduced costs on the Solana platform made PYUSD a more feasible option for everyday transactions, consequently encouraging PayPal to integrate cryptocurrency functionalities for its business users.

Commenting on the integration with Solana, Sheraz Shere, General Manager of Payments at the Solana Foundation, said, “Solana’s blockchain is uniquely optimized for high-speed and cost-effective transactions, making it a perfect fit for PayPal’s new and expanding payment solutions.” He added, “We believe PayPal’s adoption will further drive fintech evolution.”

Market data from BraveNewCoin exhibits a striking climb in PYUSD’s market capitalization, surging from about $45 million in September 2023 to approximately $700 million currently, indicating the burgeoning growth of PayPal’s cryptocurrency ventures.