PayPal has partnered with cryptocurrency company Paxos to launch a new service. PayPal users in the U.S. will soon be able to buy, hold and sell cryptocurrencies. More countries are coming soon.
PayPal plans to support Bitcoin, Ethereum, Bitcoin Cash and Litecoin at first. Users will be able to connect to your PayPal account to buy and sell cryptocurrencies. Behind the scenes, Paxos takes care of trading and custody.
In early 2021, PayPal wants to let users use their crypto assets as a funding source for your PayPal purchases. This could be a good way to use cryptocurrencies for everyday purchases without having to convert cryptocurrencies on an exchange first.
There are 26 million merchants that offer PayPal around the world. For those merchants, customers paying in crypto won’t have any impact. Everything will be converted to fiat currency when a transaction is settled.
As part of today’s move, PayPal has been granted a conditional BitLicense by the New York State Department of Financial Service. It should be able to launch its crypto service in partnership with Paxos in New York.