The crypto and fintech spheres are abuzz with news that PayPal could potentially be making an entrance into the cryptocurrency sphere by offering its users the ability to buy and sell cryptocurrencies. But are the rumours true?
The story started with a CoinDesk report on Monday, June 22nd, which stated that several people familiar with the matter confirmed that Paypal was working on building a direct buying and sales portal for cryptocurrencies within its own app and its subsidiary, Venmo.
Additionally, “they are going to have some sort of a built-in wallet functionality so you can store it there,” the source told CoinDesk. The source also stated that Paypal “would be working with multiple exchanges to source liquidity,” and that the portal could be expected to be online as soon as three months from now.
PayPal has shown some interest in cryptocurrency in the past
Although PayPal hasn’t come out and announced an entry into cryptocurrency, the company’s history does seem to say that an entrance into the world of cryptocurrency sales is highly likely. After all, Paypal has brushed up against the cryptocurrency world in the past; however, this would be the first time that Paypal dipped its toes directly into the crypto pond.
This is BAKKT x10. If PayPal and Venmo are truly entering crypto, then this is arguably the most bullish news that we have seen in the space… ever. https://t.co/PelWHZvJ3U
— The Wolf Of All Streets 🐺 (@scottmelker) June 22, 2020
For example, PayPal can currently be used as an alternative means for withdrawing funds from a number of different cryptocurrency exchanges, including Coinbase. CoinDesk also reported that Paypal and Coinbase have had a longstanding relationship with ties forming between the two companies as early as 2016.
Roel Wolfert, serial entrepreneur and chief executive of Shareitt, told Finance Magnates that “PayPal has been working with crypto since 2014 when they started accepting Bitcoin. Throughout the years they have learned and gained experience with crypto and blockchain technology.”
Therefore, Wolfert believes that “this next step is not a surprise.”
Other fintech and payments platforms have increasingly turned toward crypto
He also pointed out that PayPal’s rumoured foray into crypto is likely driven by user demand: “obviously, PayPal has the ability to know their customers and be clear on servicing them or not for the right reasons,” he said.
PayPal may have observed some of its fellow payments companies giving into similar user demand for crypto, and thereby cashing in on crypto endeavors.
Square, the payments company founded by Jack Dorsey, chief executive of Twitter, began allowing its users to buy Bitcoin directly in 2018 through the Square Cash App. In its most recent earnings report, the app had raked in $306 million in…