PayPal Holdings Inc. shook up the crypto industry yesterday. The online payments giant confirmed, it is entering the cryptocurrency market and launching its cryptocurrency services.
The U.S.-based company stated that it will allow its customers to buy, sell, and hold digital currencies through their PayPal accounts.
PayPal turning to Bitcoin means the company’s users will be able to spend their digital coins at one of the largest merchant’s networks in the world. PayPal’s network currently covers over 26 million merchants around the globe.
According to the company’s blog post, the U.S. PayPal accounts will be the first ones to buy and sell cryptocurrencies in the upcoming weeks. PayPal plans to add more crypto-related services and to expand to other countries in early 2021.
PayPal to Bitcoin: what does it mean
With over 346 million active users PayPal is one of the most popular services in the online shopping industry. Thus PayPal turning to Bitcoin definitely contributes a lot to cryptocurrency mass adoption.
According to Dan Schulman, president and CEO of PayPal, the shift to digital forms of currencies is inevitable and the company is ready to actively collaborate in shaping the future of global economy:
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 is not the first mainstream online payment provider to add cryptocurrencies to its services. Other leading fintech companies like Robinhood and Square’s mobile payments Cash App already provide the ability to use crypto services for millions of users.
However, none of them compete with PayPal in terms of active accounts and processed payments amounts. The company has over 346 million active users at the time of publishing and is the most popular option in online shopping.
Bitcoin’s price jump
The news of PayPal launching its own cryptocurrency payment service instantly moved the cryptocurrency markets. Bitcoin jumped up by nearly 7% within the past 24 hours, according to CoinGecko, and even crossed the $13.000 mark on October 22.
Other cryptocurrencies which will be initially added together with Bitcoin are Ethereum (ETH), Bitcoin Cash (BCH), and Litecoin (LTC). All of them are rallying respectively, with up to 12% increase (LTC) during the past 24 hours.
Crypto market welcomes the news
The PayPal news raised a wave of welcomes and positive reactions on social media. Mike Novogratz, the famous crypto advocate, called it the news of the year in the crypto industry. He also predicts traditional banks to start a fierce competition for crypto services in the future.
In the meantime, Tyler Winklevoss, the CEO and Founder of Gemini claims the power balance between fiat and crypto will change one day when cryptos become the mainstream, and fiats will be overwhelmed.
PayPal is an important bridge between the mainland and the island of crypto. The diaspora from legacy finance is happening and this is the kind of infrastructure that will help make that happen. Soon there will b a flippening and crypto will b the mainland & fiat the island 🌴 🚀— Tyler Winklevoss (@tylerwinklevoss) October 21, 2020
PayPal though is not new to the cryptocurrency industry. The payments provider was among the founding members of Facebook’s Libra project a year ago, however, pulled out of it months after without proper explanation.