PayPal announced that its business customers can now buy, hold, and sell crypto with the same functionality as consumer accounts.
The crypto service will be available to all PayPal Business Accounts in the U.S., except for clients in New York state. Along with on-platform transactions, PayPal will also support withdrawals to external wallets for added security.
“This is a pretty cool announcement from PayPal’s crypto product team,” said James Wester, Director of Cryptocurrency at Javelin Strategy & Research. “To this point, there was a need for ‘on and off ramps’ for any crypto payments to merchants and businesses. For PayPal account holders to pay a merchant ‘with crypto’ required the crypto to be exchanged for U.S. dollars and then that money was settled into the merchant’s account.”
Expanding Reach
PayPal’s leadership noted that its experience in the consumer crypto market has positioned the company well for expanding its reach to businesses.
“Business owners have increasingly expressed a desire for the same cryptocurrency capabilities available to consumers,” said Jose Fernandez da Ponte, Senior Vice President of Blockchain, Cryptocurrency, and Digital Currencies at PayPal. “We’re excited to meet that demand by delivering this new offering, empowering them to engage with digital currencies effortlessly.”
Significant Inroads
The payments giant has made substantial investments in digital assets since it first enabled crypto transactions for consumers four years ago, including the launch of the PayPal USD (PYUSD) stablecoin last year. While PYUSD has made significant inroads in a short time, it still trails Tether’s USDT and Circle’s USDC considerably.
The adoption of PayPal’s stablecoin accelerated after the company added support for PYUSD in Xoom, PayPal’s cross-border payments platform. Momentum also picked up after PayPal added PYUSD to the Solana network, which offers significantly lower transaction fees compared to Ethereum. The company hopes this move will entice consumers to use PYUSD for smaller purchases, a shift further supported by the new crypto functionality for businesses.
“This change allows businesses to accept crypto, including PYUSD, natively into their accounts,” Wester said. “Businesses can also pay their vendors using crypto. It effectively creates an ecosystem where PYUSD can be used for instant, free payments. Given the size of PayPal’s consumer and merchant reach, it could be important.”
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