PayPal has entered the cryptocurrency market, giving customers the ability to buy, hold and sell coins when the service rolls out next week.
Customers can buy four types of cryptocurrencies – Bitcoin, Ethereum, Litecoin and Bitcoin Cash, and can view real-time crypto prices.
It follows the company’s announcement last year that cryptocurrencies would become an allowed payment type for its service, driving the price of many cryptos up.
Customers can purchase cryptocurrency worth as little as £1 through PayPal and can fund purchases directly from their PayPal account.
While there are no fees to hold cryptocurrency in a PayPal account, there are transaction fees that are always associated with cryptos, as well as currency conversion fees for switching to another currency.
The high price of transactions is one of the major drawbacks of popular coins such as Bitcoin and it can fluctuate quickly. Currently, a transaction costs around $3 (£2.19), although this rose to over $60 for a short time in April this year.
“The pandemic has accelerated digital change and innovation in all aspects of our lives – including the digitization of money and greater consumer adoption of digital financial services,” said Jose Fernandez da Ponte of PayPal’s cryptocurrency arm.
“Our global reach, digital payments expertise and consumer and business knowledge, combined with rigorous security and compliance controls, gives us the unique opportunity and responsibility to help people in the UK explore cryptocurrency.
“We are committed to working closely with regulators in the UK and around the world to offer our support – and make a meaningful contribution to shaping the role digital currencies will play in the future of global finance and trade.”
PayPal has confirmed that the new service will roll out in the UK this week and will be available to all eligible customers within a few weeks. But UK customers still cannot make purchases from participating companies that use cryptocurrencies, unlike account holders in the US.
In July, the European Commission proposed making cryptocurrency transactions traceable to help authorities investigate money laundering. The proposals would effectively extend the financial rules for traditional financial service providers to include cryptocurrency service providers.