Paypal, a popular deposit method to many exchanges, has dedicated new features to enable its users to transfer their digital assets away from its platform.
Cryptocurrency holders will finally be able to move their assets to external wallets and exchanges. Users could not move their digital assets in the two years since PayPal enabled crypto holding and trading for select users on its platform back in October 2020. Crypto Lists view this launch as a critical addition in assisting PayPal to remain competitive in the cryptocurrency industry.
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Feature Moving Crypto off PayPal’s Platform
The significant announcement on June 7, 2022, is a welcome relief for several crypto users on PayPal. When PayPal initially allowed its users to hold and transfer crypto in 2020, there was applause for the fintech platform supporting the cryptocurrency industry. However, it limited the utility of digital tokens on its platform by restricting users from checking them out of PayPal. The recent announcement is a result of consumer demand in addressing the pleas of its users. Transferring crypto to and from wallets and exchanges in the parameters of a user’s account opens up opportunities for several external wallets and crypto exchanges such as Binance, FTX, and Coinbase. There is developing interest in the value of business transactions amongst merchants on the platform through its Checkout with Crypto function. It is essential to note that this newly developed feature is available to select customers in the United States, just as with crypto trading. Paypal intends to roll out the feature to each eligible United States user in the next few weeks.
There has been a deliberate move away from the rigid custodial platforms to open systems by large fintech parties while penetrating the cryptocurrency industry. PayPal’s crypto trading and holding launch back in 2020 allowed users to trade and hold four cryptocurrencies. These include Bitcoin, Ethereum, Bitcoin Cash, and Litecoin. This long-awaited feature allows PayPal’s offering to be similar to other cryptocurrency services. Robinhood, a financial services company, responsible for initiating commission-free stock trading, facilitated Crypto Withdrawals in April. Paypal has now launched the same.
The VP speaks
PayPal Senior Vice President, Jose Fernandez da Ponte, had previously indicated in 2021 that plans to allow its users to transfer coins to third-party wallets were ongoing. He highlighted that this move represents PayPal’s evolution as the best-in-class platform. It allows its users to engage with the broader crypto ecosystem. He further insisted those who transfer their crypto into Paypal extend the token’s utility by spending it using the Checkout with Crypto Products at several merchants. Users can engage with a broader DeFi ecosystem and participate in financial transactions. These include permissionless loans and developing liquidity for automated money makers such as UniSwap.There is more to speculation on crypto. Users want to earn yield and buy NFTs. Da Ponte claims that stablecoins are essential in facilitating the digital asset’s utility.
Impact of PayPal’s Recent Crypto Feature
It is a significant milestone for the cryptocurrency industry. PayPal, which also owns Venmo, has over 400 million users transferring funds globally. It also has several merchants accepting the platform as a deposit method. da Ponte reiterated that PayPal’s move into the crypto sector is influenced by its role as a payments and commerce company. In the crypto sector, it allows further access to the ecosystem. A substantial number in commerce is moving to digital currencies. PayPal’s announcement offset a marginal stock rise and a bull run in the crypto markets. Mikkel Morch, executive director at digital asset hedge fund ARK36, notes that fintech and payments companies integrate crypto despite the current bear market. He justifies this through the increased demand for convenient means of accessing crypto. This is significantly positive for the cryptocurrency industry as mainstream adoption is on acceleration. Walter Hessert, Head of Strategy at Paxos, indicates that PayPal is now the largest blockchain-enabled consumer digital wallet.
PayPal also announced that the New York Department of Financial Services (NYDFS) granted it a full Bitlicense. It becomes the first company to convert from a conditional Bitlicense into a full Bitlicense. It is a reward for its commitment to responsible innovation through the accessibility and utility of digital currencies. Ivan Ravlich, CEO of Hypernet Labs, believes PayPal is a leader among crypto users, especially its compatibility with decentralisation.
The fintech company reminded its users that cryptocurrency transactions are irreversible. Users must be keen when handling these transactions. It also disclosed a network fee for sending cryptocurrency outside PayPal. Sending and receiving crypto on PayPal has no network fees, but the exchange rates are way wore than when using some of the prominent crypto platforms and exchanges in our reviews section.
Crypto Lists perceives PayPal’s recent move as long-term and indicates its commitment to invest in the cryptocurrency industry.