Fintech giant PayPal could potentially be making an entrance into the cryptocurrency market by offering its clients the ability to buy and sell cryptocurrencies. PayPal plans to carry out direct sales of cryptocurrency to its 325 million users.

At the moment, PayPal can be used as an alternative way for withdrawing funds from exchanges such as Coinbase, but this would be a first method of offering direct sales of crypto. PayPal are going to introduce some sort of a built-in wallet functionality so clients can store cryptocurrency there.

Currently it is not clear which or how many cryptocurrencies would be available but it is speculated that PayPal would be working with multiple exchanges to source liquidity. Newly introduced service could be expected in the next three months or maybe sooner.

Although PayPal officially hasn’t come out and announced an entry into cryptocurrency, the company’s background seems to say that an expansion into the market of cryptocurrency sales is highly likely. PayPal have some experience in cryptocurrency market in past, but this would be the first time company directly take a part in industry. PayPal has been working with crypto since 2014 when they started accepting Bitcoin, and over the years, company have gained experience with crypto and blockchain technology. Furthermore, PayPal is hiring crypto and blockchain experts and it has been said that the global payment platform will enable direct cryptocurrency purchases for its users. The role includes designing, developing and maintaining key crypto products/features targeted towards availability, performance, and scalability of PayPal services Taking into account previous experience and content of job advertisement posted by company, such a move is self-evident and possible.

Such a step is being taken mostly because of growing demand from users and observations from other payments companies giving into similar user demand for crypto. Other payment company Square, began allowing its users to buy Bitcoin directly in 2018 throughout its app. In Square most recent earnings report, the app had accumulated in $306 million in Bitcoin-related revenue. With more and more people turning to cryptocurrency as online payment method, it would just reasonable that a company predominantly providing fiat transactions would want to pave the way in such a fast-growing industry.

In addition to big profits, crypto and blockchain also have appeared as a technological advance, because more and more companies are using blockchain as part of their payments processes and the technology is efficient and low cost, which is beneficial for end-users. On the other hand, it will be important for cryptocurrencies to be clear about their ‘nature’; some cryptocurrencies are really created to have a constant value and are therefore great for payments – others are fluctuating and will be less used for payments but more for investment, saving and speculation.

Company’s existing AML and KYC measures could be enough for crypto purchases, but there may be some additional regulatory requirements, in practically, there could be extra verification requirements for users in order to buy major cryptocurrencies and users will not be allowed to transfer crypto from other accounts because of FATF regulation. Also, PayPal as a regulated institution–will be required to comply with KYC and FATF regulations, as well as being auditable by their accountant.

Entrance of a company as huge as PayPal into the cryptocurrency market could benefit cryptocurrency industry and expose market to more potential consumers. Company’s name and prestige brings a sense of trust and stability, and this will only help the industry gain a larger number of followers.

Such a step could also give a contribution to internal market competition. This way other exchanges could start to re-evaluate their products and costs to be able to stand up against big companies like PayPal. This will promote blockchain investments and the payments industry will open secure ways for consumers to get more certainty when they are buying, selling, and spending crypto.

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