On Wednesday 26th September, PayPal announced that its US business account holders can now buy, sell, and hold cryptocurrencies directly through their accounts, expanding its crypto offerings to a wider audience.
This latest feature adds to PayPal’s existing services, which have allowed consumers to trade cryptocurrencies since 2020. With this new update, PayPal aims to meet the growing demand from business owners who have been requesting similar cryptocurrency capabilities.
Jose Fernandez da Ponte, Senior Vice President of Blockchain, Cryptocurrency, and Digital Currencies at PayPal, said, "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."
What This Means to PayPal Business Account Holders
The new functionality will allow business account holders to trade major cryptocurrencies directly from their PayPal accounts.
However, the service is initially unavailable to businesses in New York State due to regulatory constraints, including the state's stringent BitLicense requirements.
In addition to buying and selling crypto, US merchants will be able to transfer cryptocurrency on-chain to third-party wallets. This feature provides greater flexibility for businesses, allowing them to interact with external wallets, making crypto transactions more versatile for day-to-day business operations.
Since launching its consumer crypto services in 2020, PayPal has seen considerable growth in demand for these offerings. The addition of this feature for businesses is expected to further increase cryptocurrency adoption, particularly for US merchants looking to integrate digital currencies into their financial systems.
About PYUSD
Another significant aspect of PayPal’s cryptocurrency journey is the introduction of PayPal USD (PYUSD), a US dollar-denominated stablecoin launched in 2023.
PYUSD has already reached a $1 billion market cap and is fully backed by US dollar reserves, US Treasuries, and other cash equivalents. Issued by Paxos Trust Company, PYUSD offers businesses a stable and secure way to engage in digital transactions.
PayPal has further expanded PYUSD’s utility by allowing it to function across multiple blockchains, including Solana. This added flexibility makes PYUSD a powerful tool for businesses looking to streamline payments and reduce transaction fees.
In April 2024, PayPal introduced PYUSD as a funding option for its Xoom platform. This allows users to make international transfers with no fees when using the stablecoin.
For those unfamiliar with PYUSD, it can be purchased through PayPal and Venmo at a fixed rate of $1 per PayPal USD, providing a reliable and straightforward way for users to access the stablecoin.
Crypto Growth at PayPal
PayPal has made substantial strides in expanding its cryptocurrency services since 2020. Starting with enabling consumers to buy crypto with PayPal through personal accounts, the company has continued to build on that success by introducing crypto trading to business accounts.
Moreover, PayPal’s decision to allow businesses to hold crypto and transfer funds to external wallets reflects a larger movement toward mainstream cryptocurrency adoption. This also supports PayPal’s vision to increase cryptocurrency utility, as more businesses can now use digital currencies for a wide range of operations.
With its entry into stablecoins and the growing popularity of PYUSD, PayPal has positioned itself as a leader in making cryptocurrency accessible to both consumers and businesses.
While some states like New York may still face regulatory challenges, PayPal’s commitment to expanding these services suggests that even more options could be coming for US merchants in the future.
Final Notes
PayPal’s latest offering allowing US businesses to buy crypto with PayPal, as well as sell and hold it, marks another step forward in the company’s push toward greater cryptocurrency integration.
With the rising popularity of its stablecoin, PYUSD, and expanded blockchain support, PayPal is poised to become a major player in the digital currency space.