PayPal recently announced its account holders in the United States can buy, sell and hold cryptocurrency from their account. Digital currencies include Bitcoin, Ethereum, Bitcoin Cash and Litecoin, This will help make digital currencies more mainstream. Consumers using the PayPal app can now use cryptocurrencies to fund purchases at 29 million merchants worldwide.
PayPal promises to make digital curries a focus in the future. Dan Schulman, president and CEO, PayPal, said the company saw "an exceptional response from our crypto launch," with crypto trading volume on Jan. 11 reaching $242 million. To meet demand, PayPal had to increase user's limits for purchasing cryptocurrency from $10,000 to $20,000. Schulman also said PayPal users who signed up for crypto are using their app twice as much as before.
In their first quarterly report since they added crypto, PayPal reported their 2020 fourth quarter transaction revenue up almost 12 percent. The payment processor also gained 16 million new active account users.
Crypto demand is rising in the US among consumers and businesses. There are 36.5 million people in the US using cryptocurrencies and up to 19 percent of businesses accept at least one cryptocurrency. PayPal hopes to launch cryptocurrencies in international markets soon. PayPal is using Paxos Trust Company in the U.S. They are a regulated crypto brokerage founded in 2012 with offices in NYC, Singapore and London.
Binance, one of the world's largest cryptocurrency exchanges, launched Binance Pay in beta as a PayPal rival. Like PayPal, consumers can use their wallet to make purchases at retailers, except merchants get fiat-backed stablecoins to convert into euros. PayPal is challenging Square SQ for processing bitcoin transactions. Square bought $1.5 billion worth of bitcoin to use themselves. So far, shareholders have benefited spectacularly from the company's decision, thanks in part to CEO Jack Dorsey's bitcoin advocacy.