In response to client demand, PayPal stated that its users would now be able to transfer cryptocurrencies from their accounts to other wallets and exchanges.
“Since we started offering crypto purchases on our platform, this function has been the most requested by our users,” said Jose Fernandez da Ponte, PayPal’s SVP and general manager of blockchain, crypto, and digital currencies.
PayPal clients will be able to transfer supported coins into PayPal, move crypto from its app to external crypto addresses such as exchanges and hardware wallets, and send crypto to other PayPal users “in seconds” with the new capability.
When customers execute external transactions, they are responsible for network costs, which are determined by the blockchain and vary based on the crypto asset. There are no fees for internal transfers (Paypal to PayPal).
“If consumers have crypto elsewhere and wish to consolidate,” Fernandez da Ponte says, “they can move it to PayPal from external addresses.” “They can also transmit cryptocurrency to anyone who uses PayPal.”
In October of 2020, PayPal allowed its users to purchase, sell, and store cryptocurrency. Then, in late March 2021, PayPal announced the debut of Checkout with Crypto, a tool that let customers use cryptocurrencies to pay for goods and services at millions of online stores. PayPal’s current cryptocurrency initiatives include a partnership with Paxos to enable its service, which allows clients to buy, sell, and store a variety of cryptocurrencies, as well as the acquisition of bitcoin security startup Curv. Last year at Consensus, Fernandez da Ponte stated that allowing consumers to transfer data would be the next step.
“For our users who want to do more with their digital assets, this is a logical conversion,” Fernandez da Ponte told TechCrunch this week. “We see ourselves as a link between the fiat, or traditional financial, world and the web3 world.” We’re making it possible to link to other wallets, exchanges, and applications.”
Giving PayPal clients the ability to move their crypto assets — such as bitcoin, Ethereum, bitcoin cash, or litecoin — into, outside of, and within the company was a move that the corporation could not avoid if it wanted to stay ahead of the curve in a fast-changing fintech world.
Despite recent turmoil in the cryptocurrency market, Fernandez da Ponte stated that PayPal is heading in this way because “people are [still] adopting cryptocurrencies.”
“This step demonstrates that we’re committed to the long haul,” Fernandez da Ponte remarked. “I believe it is critical to stay on track and continue to invest in the space.”
The new feature is only available to customers in the United States, and PayPal says it has added an additional identification verification process for users before they can send any cryptocurrency. Select U.S. users will be allowed to do so starting today, and additional “qualified” U.S. customers (those who complete the identity verification process) will be able to do so in the following weeks.
Following permission from the Enhanced York Department of Financial Services, PayPal was authorized to offer the new capability after switching from a “conditional” BitLicense to a “full” BitLicense.
“DFS is determined to maintain New York at the forefront of responsible technological innovation and forward oriented regulation,” said NYDFS Superintendent Adrienne Harris in a statement.