Crypto Gloss

PayPal Crypto

PayPal’s cryptocurrency services launched in October 2020 when the company enabled its 400M+ users in the United States to buy, sell, and hold Bitcoin, Ethereum, Litecoin, and Bitcoin Cash directly within the PayPal app — making it one of the largest single-event expansions of consumer crypto access in history. PayPal subsequently expanded crypto to Venmo (2021), international markets, and launched PYUSD (PayPal USD) in August 2023 — a dollar-backed stablecoin issued by Paxos Trust Company that became one of the largest regulated stablecoins in the U.S.

Background

PayPal was an early institutional signal that consumer fintech giants would integrate crypto. CEO Dan Schulman made PayPal’s crypto additions strategic positioning for the “new payments landscape.” The 2020 announcement sent Bitcoin’s price higher as analysts estimated hundreds of millions of users gaining low-friction crypto access through a trusted interface.

Crypto Services Timeline

Date Event
October 2020 PayPal enables BTC, ETH, LTC, BCH buy/sell for U.S. users
March 2021 Checkout with Crypto — merchants can accept PayPal’s crypto
April 2021 Venmo adds crypto buying/selling
2022 PayPal expands crypto to UK and international markets
August 2023 PYUSD stablecoin launches on Ethereum (issued by Paxos)
2024 PYUSD expands to Solana; becomes one of the largest U.S. regulated stablecoins

PYUSD Stablecoin

PYUSD is a USD-pegged stablecoin issued by Paxos Trust Company on behalf of PayPal:

  • Reserve: 100% backed by USD deposits, short-term Treasuries, and cash equivalents
  • Chains: Ethereum and Solana
  • Supply: Grew from 0 to $1B+ within 18 months of launch
  • Use cases: P2P payments between PayPal and Venmo users, merchant acceptance, DeFi via Solana integration

Limitations of Early PayPal Crypto

The initial 2020 crypto feature was custodial — users did not control private keys and could not withdraw crypto to self-custody wallets. This attracted criticism from the crypto community (“not your keys, not your coins”). PayPal added self-custody wallet transfers in 2024, allowing users to send crypto to and from external wallets.

Related Terms

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