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In the US, more and more PayPal users have the opportunity to use “Checkout with Crypto”, as the new feature is called. The fact that the payments giant is now integrating payment functions with Bitcoin, Bitcoin Cash, Ethereum, and Litecoin in its application has caused upheaval in the crypto industry. Only the October 2020 announcement sent BTC and LTC prices skyrocketing, and the official start of this week will certainly help ensure that cryptocurrency prices are back in the green.
What you need to know with all the hype surrounding the publicly traded American company’s entry into the crypto asset business: PayPal does not act as an intermediary service that technically allows a customer to make a Bitcoin payment to a merchant, for instance. Because in reality the following happens: if you decide to pay with BTC, LTC, ETH or BCH, then the selected asset is converted to dollars (and then euros) and the dealer receives the fiat money. A merchant never comes into contact with the crypto asset, he stays with PayPal.
PayPal is said to buy 70 percent of all new bitcoins
Conversion costs something
“As soon as you confirm the purchase, PayPal converts the cryptocurrency into USD on your behalf and the transaction is complete. You will receive a receipt for the cryptocurrency sale and a receipt for the item purchased,” says PayPal. Then you sell BTC or ETH to the American company. They also boast that they would not charge a transaction fee for paying with cryptocurrencies. But of course, the service costs the customer something, because PayPal has built in a conversion margin when converting cryptocurrencies into USD.
“Checkout with Crypto” is currently only offered in the US, and later the offer will also come to Europe. PayPal has proven to be very hungry for Bitcoin and Co in the recent past and has bought large amounts of BTC. This is also offered to users in the app (Informed Trending Topics).
Lower Austrian startup Salamantex shows there is another way. This has been offering retailers for several years, in cooperation with other companies, terminals for their businesses so that, in addition to credit cards and cash, they can also offer payments with crypto assets (in this case Bitcoin, Ether, Litecoin, XRP, Stellar and Dash). At Salamantex, however, traders can decide whether they prefer to receive euros or whether they actually accept crypto assets.
Salamantex: Crypto startup is now implementing Bitcoin payment with its partner Concardis
