PayPal has introduced a new feature allowing small businesses in the U.S. to accept over 100 different cryptocurrencies, including leading ones like Bitcoin and Ethereum.
New Feature for Small Businesses
A PayPal spokesperson confirmed that the new feature is available to any U.S. merchant using the company's online payment platform. To encourage early adoption, PayPal will charge merchants a promotional transaction fee of 0.99% during the first year, which will rise to 1.5% later. According to the Nilson Report, these rates still undercut the 1.57% average fee paid by U.S. businesses to credit card networks.
Authorization and Conversion Process
The payment process will allow customers to connect their existing crypto wallets at checkout. Depending on the wallet, PayPal will facilitate a crypto sale via centralized exchanges like Coinbase or decentralized ones like Uniswap. The proceeds will be converted first into PayPal’s stablecoin, PYUSD, and then into U.S. dollars for the merchant.
Expansion Opportunities for Large Companies
PayPal intends to expand the ability for merchants to accept crypto to larger enterprise customers in the U.S. and globally; however, a spokesperson declined to provide a timeline. According to PayPal, this move taps into a $3 trillion crypto market and provides access to over 650 million crypto wallet holders worldwide.
PayPal's new cryptocurrency acceptance feature reflects the company's growing interest in digital assets and its drive to adapt to changes in the payment technology marketplace.
