PayPal Secures NYDFS License to Bitcoin and Crypto Trading Services
On Wednesday, October 21, online payments giant PayPal officially announced starting crypto trading services for all its account holders. PayPal said that service will be first available to its U.S. customers in the coming weeks and later to its global customers by early 2021.
With this announcement, PayPal becomes one of the biggest players in the financial payments market to offer support for digital currencies. The PayPal announcement notes that it service will allow users to buy, hold, and sell cryptocurrencies directly from their PayPal accounts. Initially, the PayPal Digital Wallet will be supporting only some of the top cryptocurrencies like Bitcoin, Ethereum, Bitcoin Cash, and Litecoin.
PayPal noted that it has secured its first cryptocurrency license from the New York State Department of Financial Services (NYDFS). Besides, to offer its cryptocurrency trading services, PayPal has also partnered with the Paxos Trust Company.
PayPal said that its crypto trading service will push further the global use of virtual digital currencies. Besides, it also said that it has a close eye on all the CBDC developments across the globe. Thus, it is working on its infrastructure to support central bank digital currencies in the future.
Dan Schulman, president and CEO, PayPal said: "The shift to digital forms of currencies is inevitable, bringing with it clear advantages in terms of financial inclusion and access; efficiency, speed and resilience of the payments system; and the ability for governments to disburse funds to citizens quickly”.
He further added: “Our global reach, digital payments expertise, two-sided network, and rigorous security and compliance controls provide us with the opportunity, and the responsibility, to help facilitate the understanding, redemption and interoperability of these new instruments of exchange. We are eager to work with central banks and regulators around the world to offer our support, and to meaningfully contribute to shaping the role that digital currencies will play in the future of global finance and commerce.”
PayPal said that in the coming weeks, it will also be releasing some educational content helping crypto industry participants to understand the ecosystem and weigh the opportunities and risks of investing in digital assets.
Interestingly, PayPal said that it will also introduce crypto shopping for its users by early 2021. With over 26 million global registered merchants, PayPal remains the hot destination for online shoppers. The payments giant said that it allows users to buy goods directly through their crypto holdings in the PayPal wallet. However, the merchants will continue to receive payments in fiat.
Many analysts have rejoiced PayPal’s entry into the crypto space. This will instill more confidence in the market while attracting other financial institutions to follow them. However, some analysts pointed out that PayPal’s terms of service for its cryptocurrency trading restrict the movement of funds from its wallet to other accounts. They see this as opposite to crypto’s inherent freedom with the money movement.