PayPal crypto service goes live

PayPal users can now buy, sell, and hold bitcoin, ether, bitcoin cash, and litecoin in their accounts.

Announced last month, the crypto support went live for U.S. customers on Nov. 12, marking a new level of mainstream availability of cryptocurrency. 

In addition, PayPal said it will “significantly increase cryptocurrency’s utility” as it will be usable for purchases at the company’s network of 26 million merchants worldwide. 

Crypto will become available to the rest of the company’s 346 million customers in 2021. It will also expand crypto support to Venmo next year.

PayPal also increased its weekly purchase limit to $20,000, up from the initially announced $10,000. It will charge no fees for purchases or sales through the end of the year, and there are no fees for holding cryptocurrencies.

The Bank for International Settlements estimates that “one in 10 central banks – representing approximately one-fifth of the world’s population – expect to issue their own digital currencies within the next three years,” said Dan Schulman, president and CEO of PayPal. “Our global reach, digital payments expertise, two-sided network, and rigorous security and compliance controls provide us with the opportunity, and the responsibility, to help facilitate the understanding, redemption and interoperability of these new instruments of exchange.” He added:

“The shift to digital forms of currencies is inevitable, bringing with it clear advantages in terms of financial inclusion and access; efficiency, speed and resilience of the payments system; and the ability for governments to disburse funds to citizens quickly.”

Promising to work closely with central banks and regulators, Schulman added that PayPal intends “to meaningfully contribute to shaping the role that digital currencies will play in the future of global finance and commerce.” That includes providing customers with substantial educational content related to investing in crypto. He said:

“Our global reach, digital payments expertise, two-sided network, and rigorous security and compliance controls provide us with the opportunity, and the responsibility, to help facilitate the understanding, redemption and interoperability of these new instruments of exchange.”

PayPal uses crypto custodian Paxos Trust Company as its processing partner, although recent rumors suggested it wants to buy competitor BitGo. 

Corrected number of PayPal users on Dec. 12, 2020.