One of the largest online payment processors in the world, PayPal is offering its support to cryptocurrency by allowing its customers to buy, sell and hold bitcoin and other virtual coins using its online wallets.
The digital payments firm will also facilitate the use of cryptocurrencies to shop at the 26 million merchants on its network sometime in early 2021.
Dan Schulman, President and CEO of PayPal hopes that the service will further boost the global usage of virtual coins and will prepare its network for any new digital currency that may be developed by central banks and corporations across the globe.
“We are working with central banks and thinking of all forms of digital currencies and how PayPal can play a role,” the PayPal CEO remarked.
PayPal account holders in the US will be able to buy, sell and hold cryptocurrencies in their PayPal wallets over the coming weeks. The facility will be further expanded to PayPal-owned Venmo digital wallet and a few other countries by the first half of 2021.
Even though other mainstream fintech companies such as mobile payments provider Square and stock trading app firm Robinhood Markets have been supporting cryptocurrency transactions none of them have the name and penetration PayPal boasts of.
San Jose, California-based company has 346 million active accounts across the globe and processed $222 billion in payments in the second quarter of the year.
Speculators, rather than merchants and shoppers have been attracted to cryptocurrencies which have a bad reputation of being too volatile. Transactions through them are slower and more costly than other mainstream payment systems as well.
Even though the platform will support purchases with cryptocurrency, payments to merchants will be done in regular currencies such as US Dollars.
After receiving its first conditional cryptocurrency license from the New York State Department of Financial Services, PayPal will initially allow purchases of bitcoin and other cryptocurrencies called ethereum, bitcoin cash and litecoin. It has partnered with US-based fintech Paxos Trust Company to offer the service.