PayPal Enables Cryptocurrency Services for U.S. Merchants

(Reuters) – PayPal Holdings announced on Wednesday the addition of cryptocurrency capabilities for U.S. merchants to buy, hold, and sell digital currencies directly from their business accounts.

The move reflects a shift in cryptocurrency’s reputation, gaining traction after the approval of bitcoin exchange-traded funds by the U.S. SEC earlier this year.

Jose Fernandez da Ponte, Senior Vice President of Blockchain, Cryptocurrency, and Digital Currencies at PayPal (NASDAQ:PYPL), noted that business owners increasingly want the same cryptocurrency functionalities offered to consumers.

PayPal entered the cryptocurrency arena in 2020, allowing users to buy, sell, and hold bitcoin and other virtual currencies via its digital wallets. The company also launched a dollar-backed stablecoin in August 2023, becoming the first major fintech firm to adopt digital currencies for transactions.

Stablecoins are designed to maintain a stable value by being pegged to a stable asset, thus mitigating volatility.

Additionally, PayPal is allowing U.S. merchants to transfer cryptocurrency externally to eligible third-party wallets. However, these services will not be available for business accounts in New York State at launch.

As a result of these developments, shares in PayPal have risen nearly 26% this year.