PayPal Enables Companies to Buy and Sell Crypto
26 Sep, 2024 ● Crypto News
On September 25, PayPal announced that PayPal Business accounts can now buy, sell, and trade cryptocurrencies directly through their PayPal accounts.
This new feature will be available to merchants across the U.S., with the exception of those in New York.
Jose Fernandez da Ponte, PayPal's Senior Vice President of Blockchain, Cryptocurrency, and Digital Currencies, commented on the update:
"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."
Additionally, merchants using this service can withdraw their digital assets to external wallets or more secure storage options for added protection.
In August 2023, PayPal introduced its own stablecoin, PYUSD (PayPal-United States Dollar), which is issued by Paxos and fully overcollateralized, meaning it is backed by U.S. dollar deposits and short-term cash equivalents. PYUSD can be fully redeemed at a 1:1 ratio with the U.S. dollar.
PayPal later expanded PYUSD to the Solana network, leveraging Solana's significantly lower transaction costs.
The company aims to encourage the use of PYUSD for smaller, everyday purchases, such as coffee or lunch, by taking advantage of Solana’s efficiency.
Smaller transactions are often not feasible on lower throughput blockchains due to higher fees and slower transaction times.
For instance, while a Solana transaction might cost as little as $0.0025, Ethereum transactions can become prohibitively expensive, especially during times of network congestion.
In addition, PayPal announced that PYUSD transactions on Solana would feature "confidential transactions," which obscure the payment amount from the public while keeping the transaction itself visible for compliance purposes.
More recently, PYUSD has reached a market capitalization of $1 billion, although it still trails behind Tether's USDT and Circle's USDC.
As of August 2024, Tether had a market capitalization of $118 billion, while Circle's USDC held a $35 billion market cap.
Sources:
https://cointelegraph.com/news/pay-pal-enables-business-accounts-buy-sell-trade-crypto
