Consumers with a preference for cryptocurrencies can now use PayPal to make online payments at checkout using their preferred unit of currency.
PayPal (NASDAQ: PYPL) has introduced Checkout with Crypto, an offering that enables PayPal Wallet holders of cryptocurrencies such as bitcoin to use that currency at checkout and PayPal will automatically convert the payment to U.S. dollars with no additional integrations or fees for businesses. Transactions in other currencies will be settled based on PayPal conversion rates, the company said.
“Until now, offering cryptocurrency as a payment type has been challenging for businesses – from integration requirements, technical barriers and general lack of awareness among consumers,” Jim Magats, senior vice president of omni payments for PayPal, explained in a blog post. “Checkout with Crypto allows businesses to accept the proceeds from sales of cryptocurrency as a payment type, all within the current PayPal integration, removing the need for any additional action for businesses.”
PayPal said millions of businesses can now accept the crypto payments, with more businesses to be added in the coming months. The business will receive its payment in U.S. dollars.
“With interest around crypto growing, Checkout with Crypto introduces another way for businesses to get paid and is a natural extension of the broad portfolio of services offered to PayPal merchants to drive engagement with their customers. This new payment type can help merchants serve new customers who want to use their digital currencies to pay, while helping them build loyalty with existing customers who want more choice,” Magats added.
Checkout with Crypto will automatically appear in a customer’s wallet for those with a sufficient cryptocurrency balance, the company said.
“As the use of digital payments and digital currencies accelerates, the introduction of Checkout with Crypto continues our focus on driving mainstream adoption of cryptocurrencies, while continuing to offer PayPal customers choice and flexibility in the ways they can pay using the PayPal wallet,” Dan Schulman, president and CEO of PayPal, said. “Enabling cryptocurrencies to make purchases at businesses around the world is the next chapter in driving the ubiquity and mass acceptance of digital currencies.”
The program will accept Bitcoin, Litecoin, Ethereum or Bitcoin Cash. Only one crypto can be used per transaction.
Earlier in March, PayPal announced it would acquire Curv, a provider of cloud-based infrastructure for digital asset securities such as cryptocurrencies. Curv was founded in 2018 by CEO Itay Malinger and CTO Dan Yadlin.
“As a pioneer in security infrastructure for digital assets, Curv is proud to be recognized as an innovator and trusted partner to leading financial institutions around the world,” said Malinger. “Now, as the adoption of digital assets accelerates, we feel there’s no better home than PayPal to continue our journey of innovation. We’re excited to join PayPal in expanding the role these assets play in the global economy.”
PayPal expects the transaction to close in the first half of this year.
John Rainey, CFO and EVP of global customer operations for PayPal, while speaking during the Morgan Stanley Technology, Media and Telecom Conference at the beginning of March, noted the potential for cryptocurrencies and digital currencies in the U.S., adding that PayPal believes it can provide crypto services without the need to become a bank.
“Our current expectations are that to provide the services that we want for our merchants and consumers around the world, we don’t need to be a bank, at least as it pertains to the United States … but this is where I think we can partner with many others, whether we’re talking about crypto or high-yield savings account or even financial services,” he said.
PayPal first announced in November 2020 that U.S. account holders could buy, sell and hold cryptocurrencies in their PayPal wallets, with a weekly purchase limit of $20,000. PayPal’s system accepts Bitcoin (BTC-USD), Ether (ETH-USD), Bitcoin Cash (BCH-USD) and Litecoin (LTC-USD).