PayPal has introduced cryptocurrencies to its platform in an attempt to expand the transaction methods already available to consumers. Customers in the United States can now use the “Checkout with Crypto” feature available on the app as a payment method when making a purchase. Last November, PayPal rolled out the ability to its users to buy and sell cryptocurrency directly from their account. Now, they can instantly convert their Bitcoin, Ethereum, Litecoin, or Bitcoin Cash to US dollars, having no extra transaction fees.
If a merchant doesn’t accept US dollars, PayPal has the ability to convert those dollars into local currency at usual conversion rates set by the company.
Today, we are announcing the launch of Checkout with Crypto, a new way for PayPal customers to check out with #Cryptocurrency to pay for select online purchases. https://t.co/RbOe8aLtlz pic.twitter.com/zGWHgbwVlU
— PayPal (@PayPal) March 30, 2021
This new feature will appear automatically in the PayPal wallet if the user has a “sufficient cryptocurrency balance to cover an eligible purchase.” For each kind of coin, a balance will appear, however the consumer can only use one type of cryptocurrency at a time for each purchase.
Dan Schulman, PayPal’s CEO, stated, “Enabling cryptocurrencies to make purchases at businesses around the world is the next chapter in driving the ubiquity and mass acceptance of digital currencies.”
Not The First Payment App To Offer Cryptocurrency
In 2018, PayPal’s antagonist, Square, launched support for Bitcoin on their Cash App in all 50 US states after suffering only being limited to some. At the time, the expansion stemmed from a report in their earnings which said that bitcoin had a profit margin of $420,000 in Q2. The company invested $36.6 million to access Bitcoin but only received $37 million back. New York, Georgia, Hawaii, and Wyoming were some of the cases which led Square to face a downfall as there were more strict restrictions on cryptocurrency transactions.
In Wyoming specifically, the restrictions were removed a couple months later, however in states like new York, companies are requires to have a “BitLicense” in order to function, which the company obtained in that year.
PayPal Cryptocurrency Importance
The significance of PayPal’s decision to include this feature in their app works towards their advantage as they are now both a major digital wallet, and an app offering cryptocurrency exchange. This method of payment will slowly become the new mainstream because of its rapid increase in popularity among consumers. This will lead cryptocurrency to lead the market as a common payment method. According to the company’s recent Investor Day, it reported that it had 377 million active accounts.
Other Companies Launching Crypto Payments
PayPal is not the only company setting focus to the what will become our “new normal” when making transactions. Visa announced yesterday that it would process crypto payments, Tesla recently began accepting this method for their merchandise, and Mastercard said in February that it would soon enable such transactions.
Mixed Comments And Reactions
Twitter had a say in PayPal’s newest launch in cryptocurrency, revealing multiple opinions. The platform offered both ends of the spectrum in terms of perspectives. Some described this as “inevitable” knowing the rise in its popularity, while others mentioned how Bitcoin is not a “real” and they would rather use money that “exists.”
Paypal is allowing people to paying Bitcoin and ETH. Don't buy my commissions if you consider paying in that. Ew.
— Lexi'to✨ (@regrahh) March 30, 2021
Paypal is going to accept Cryptocurrency soon, and I just wanted to say I don't accept payment for commissions in Bitcoin. I prefer money that exists
— captaintaco2345✊🏿✊🏾✊🏽 (@captaintaco2345) March 30, 2021
BREAKING: PayPal has launched the ability for users to spend their bitcoin at millions of retailers globally, according to @annairrera.
Bitcoin is inevitable.
— Pomp 🌪 (@APompliano) March 30, 2021
PayPal to announce to U.S. consumers can now use cryptocurrency to pay at millions of its online merchants globally. #Bitcoin
In retrospect, it was inevitable🚀🚀
— The Chairman (@WSBChairman) March 30, 2021
Either way, PayPal is an example of another company opening the gateway to cryptocurrency transactions, increasing the likelihood of a further global expansion.