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PayPal in the U.K. will be able to manage cryptocurrencies through the platform starting this week.
PayPal allows cryptocurrency trading in the U.K. Until now, PayPal only offered this service to users in the U.S. The platform authorized the buying and selling of crypto to U.S. customers in October last year.
PayPal, cryptocurrencies in the United Kingdom
The company explained that its British customers would buy, hold, and sell Bitcoin, Ethereum, Litecoin, and Bitcoin Cash on its YouTube channel. Only selected customers could trade cryptocurrencies when it launched the service in the United States. Customers must verify their identity to qualify for selection, and PayPal will not admit company profiles.
Last June, the U.K.’s Financial Conduct Authority (FCA) published a report stating that 2.3 million adults in the country owned crypto, up from 1.9 million in 2020. PayPal could enable cryptocurrency payments in the U.K. within a few months. The Americans were able to do so in March this year. That is, five months after allowing cryptocurrency trading.
PayPal users can start in crypto with as little as £1 or $1, but they have capped the maximum investment amount. The spokesperson said that U.K. users couldn’t purchase crypto worth more than £15,000 a week. The maximum amount for purchases over 12 months is limited to £35,000. However, in the U.S., the weekly purchase limit is much higher, currently at $100,000.
Like a credit card
On that occasion, Dan Schulman, the company’s president, and CEO told Reuters that this was the first time users could use cryptocurrencies like a credit card or debit card within the PayPal wallet. Schulman also indicated that cryptocurrencies became a legitimate funding source to transact with millions of merchants. According to Schulman, crypto was only an asset class to be bought, held, or sold until now.
PayPal’s crypto trading volumes are unknown for the moment. Unlike Square and Robinhood, PayPal doesn’t provide financials about its crypto business.
Bitcoin above $50,000
In May, Paypal, which does not yet allow cryptocurrency withdrawals off the platform, said the company is working on the withdrawal feature. PayPal’s announcement coincides with the bitcoin price trading above $50,000, a figure it had not reached since last May. The company explains on YouTube that users will view cryptocurrency prices in real time and access educational content on their website and app.
Since entering the cryptocurrency market last October, PayPal has not ceased showing its crypto industry interest signs. A few days ago, it also became known that the company had invested, along with Visa, in a $300 million fund from Blockchain Capital.
Investments and DeFi
Blockchain Capital is a venture capital firm focused on cryptocurrencies and blockchain. Since its founding, it has invested in Coinbase, Anchorage, the NFT platform Opensea, and the DeFi Aave and Nexus Mutual protocols.
Paypal’s VC unit backed startups previously like TaxBit, TRM Labs, and Talos. Earlier this year, PayPal also acquired the crypto-security firm Curv.
In late July, there was news that PayPal might be interested in decentralized finance (DeFi). Uniswap Labs growth director Ashleigh Schap broke the news while participating in Ethereum’s EthCC 4 2021 conference in Paris. Schap explained that PayPal was interested in talking to Uniswap about bringing decentralized finance into the mainstream.