PayPal to roll out ‘pay with crypto’ feature for merchants

(Bloomberg/Emily Mason) — PayPal Holdings Inc. will soon allow businesses to accept more than one hundred cryptocurrencies at checkout.

The option is going live in the coming weeks and will allow merchants to accept crypto such as Bitcoin, Ethereum, Tether’s USDT and Circle’s USDC, from wallets including Coinbase, OKX, Phantom, MetaMask and Exodus. When a consumer pays with crypto, the funds are automatically converted into fiat or PayPal’s PYUSD stablecoin for deposit in the merchant’s account.

“You have globally 650 million users that participate in the $3 trillion market of cryptocurrencies,” said Frank Keller, general manager of large enterprise and merchant platform at PayPal, in an interview with Bloomberg. “We wanted to give small businesses access to this customer base that is growing.”

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For small businesses accepting payments from buyers abroad, the associated fees can exceed 10%, Keller said. It can also take several days for the transaction to settle, he added. Meanwhile, the ‘Pay with Crypto’ transactions settle instantly and will initially cost 0.99% per transaction, according to PayPal. Businesses that choose to convert their funds to PYUSD can earn about 4% on those balances.

“It’s still nascent but it’s surprising how quickly it’s picking up,” Keller said, referring to consumer demand to pay with cryptocurrencies. “When PayPal turns it on, it creates trust.”

Keller replaces Jose Fernandez da Ponte, PayPal’s former general manager of blockchain, crypto and digital currencies, who left earlier this month. Going forward, PayPal’s goal is to continue embedding digital assets and blockchain more deeply into its open platform.

“We want to show that we’re long-term invested in the crypto space,” Keller said. “We want to play a bigger role, and for that to be successful we need to really scale it to the next level. I took over to really embed it into the core of our payment rails.”

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