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| PayPal joins the cryptocurrency market |
PayPal entered the cryptocurrency market, enabling customers to buy, sell and hold these currencies directly through the online wallets of American digital payments companies.
The platform plans to use it as a funding source for 26 million merchants around the world as of early 2021 to purchase transactions through its network, greatly enhancing the usefulness of cryptocurrencies.
Chairman and CEO Dan Shulman (Dan Shulman) said: PayPal hopes that this new service will enhance the use of virtual currency around the world and prepare its network for new numbers that may be developed by central banks and companies. .
The company, based in San Jose, California, said that it works with the central bank and is studying various forms of cryptocurrencies, as well as how PayPal works.
Over the next several weeks, the company said, US account holders will be able to buy, sell, and hold virtual currency in their wallets through PayPal.
The platform plans to expand its services to Venmo and specific countries in the first half of 2021.
Other well-established fintech companies like mobile payment provider Square and stock trading app company (Robinhood Markets) allow users to buy and sell digital currencies.
PayPal's entry into this market is noteworthy due to its colossal impact: the company has 346 million active accounts worldwide and processed payments totaling $ 222 billion in the second quarter.
Cryptocurrencies are often volatile, which makes them attractive to speculators, but not to traders and buyers.
Compared to other traditional payment systems, transactions are slower and more expensive.
The company said that payments in digital currency through PayPal will be in fiat currencies (such as the US dollar), which means that merchants will not make payments in virtual currencies.
Several central banks around the world have expressed their intention to develop digital versions of their currencies in the coming years.
Facebook ran a cryptocurrency project called Libra in 2019. PayPal was a founding member but withdrew a few months later.
PayPal initially agreed to purchase Bitcoin and other cryptocurrencies called Ethereum, Bitcoin Cash and Litecoin, and has partnered with the Paxos Trust to provide services.