PayPal to allow cryptocurrencies after obtaining a New York license

PayPal to allow cryptocurrencies after obtaining a New York license

PayPal has decided to embrace cryptocurrencies and will soon offer its customers in the United States (U.S.) the ability to buy, hold, sell, and use various virtual currencies. The company has obtained a New York license allowing it to do so.

PayPal customers would be able to use the cryptos as a funding source at the company's 26 million merchants from early 2021.

The move is seen as an endorsement from PayPal and its sprawling digital wallet network as a means of catapulting cryptocurrencies into mainstream use.

PayPal will support four different cryptocurrencies — bitcoin, ethereum, litecoin and bitcoin cash — together with fintech startup Paxos.

The company said it will expand crypto support to its social payments app Venmo in early 2021, as well as additional countries outside the U.S.

The New York State Department of Financial Services — which regulates financial services and products — granted PayPal a "conditional Bitlicense" to offer the service, the first time it has done so.

PayPal's CEO, Dan Schulman, said the shift to digital currencies "is inevitable" in a press release. He said the company is keen to work with banks and regulators around the world to help shape "the role digital currencies will play in the future of global finance and commerce."

PayPal said it would partner with BitGo competitor Paxos Trust Company, a regulated provider of cryptocurrency products and services for its new service.