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PayPal Inc. today launched a new service that will allow users to buy, hold and sell cryptocurrencies directly from their existing PayPal accounts.
The service will initially support bitcoin, Ethereum, Bitcoin Cash, and Litecoin and will be available to PayPal users in the US in the coming weeks. Cryptocurrency support for Venmo, PayPal’s mobile payment service, and select international markets is planned for the first half of 2021.
Support for cryptocurrencies also extends to business transactions. Sellers will be able to accept payments in cryptocurrencies, while users can also take advantage of their crypto balances to make purchases.
“The change to the digital forms of currencies is inevitable, bringing with it clear advantages in terms of financial inclusion and access; efficiency, speed and resilience of the payment system; and the ability of governments to disburse funds to citizens quickly ”. And Schulman, president and CEO of PayPal, said in a statement. “Our global reach, experience in digital payments, bilateral network and rigorous security and compliance controls provide us with the opportunity and responsibility to help facilitate the understanding, exchange and interoperability of these new exchange instruments.”
Offering cryptocurrency support is not as simple as a company that says it intends to do so with the required regulatory approval. In that regard, the announcement does not disappoint: PayPal obtained a “first of its kind” conditional BitLicense from the New York State Department of Financial Services.
New York launched its BitLicense in 2015 to an initial setback, but it has since been adopted by companies operating in the cryptocurrency space. A BitLicense grants regulatory approval to companies that operate in the state of New York and that perform virtual currency exchange services.
The conditional BitLicense in this case was awarded to PayPal in association with Paxos Trust Company LLC, which provides cryptocurrency custody and trading services to PayPal and its users.
The announcement is the first time that PayPal will directly offer cryptocurrency services to its users, but it is not the first time that it has ventured into virtual currency. PayPal was an initial member of Facebook Inc.’s Libra Association and the first company to withdraw in October 2019.
Investors liked the news. On a day that the Nasdaq Composite fell 0.3%, PayPal shares rose 5.5% to $ 213.07, its highest closing price to date. Its previous high close was $ 210.82 on Sept. 2.
Photo: PayPal
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