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PayPal to Launch Its New Crypto Service in Partnership with Paxos

By July 20, 2020 No Comments
  • PayPal has picked Paxos to provide cryptocurrency liquidity for their future crypto buying and selling feature
  • PayPal will become the second large customer of the Paxos’ recently launched Crypto Brokerage
  • Exchanges Coinbase and Bitstamp have also been rumored to be pursuing a deal with online payments giant

According to two sources familiar with the topic, PayPal has partnered with New York-based Paxos to launch its cryptocurrency buying and selling feature. This newly established corporate relationship could be officially revealed to the public as soon as this week. When PayPal finally rolls out cryptocurrency purchases it will become one of the most influential mainstream payments companies to do so, joining the company of less mainstream payment providers like Square and Robinhood.

Paxos Crypto Brokerage Launched Just Last Week

Paxos is a U.S.-based cryptocurrency company, which fully complies with the U.S. regulatory framework and even holds a trust charter issued by the state of New York. 

The firm launched Paxos Crypto Brokerage just last week and their service turned out to be a major success, signing its first deal with the American division of the U.K.-based fintech giant Revolut in the first few days. Paxos Crypto Brokerage, which for now offers cryptocurrency buying and selling, while also facilitating crypto holding and transacting, makes it easy for businesses to integrate these cryptocurrency services into their own products. Aa a fully qualified custodian, Paxos is allowed to hold gold and digital assets on behalf of institutional investors.

In a recent blog post, Paxos CEO Charles Cascarilla stated that the launch of the crypto brokerage could significantly boosted crypto adoption. He also revealed that the firm will need to scale up its itBit exchange to meet the demands of new clients. Cascarilla wrote:

“We’re even more excited that this [launch f Paxos Crypto Brokerage] enables a major tipping point for the adoption of cryptocurrency. Instead of having to seek out new services and brands, consumers can access crypto through the brands and applications they trust – from fintech apps to banks to brokers to ecommerce brands.”

Paxos Comes out as the Winner of the PayPal Deal

According to sources, PayPal has chosen the newly launched Paxos Crypto Brokerage to provide crypto liquidity and other services for the implementation of cryptocurrency buying and selling features. This makes PayPal the second huge customer of the nascent brokerage.

Previously, the other firms, including the cryptocurrency exchanges Coinbase and Bitstamp have been mentioned as potential PayPal partners. The San Francisco-based Coinbase, which otherwise maintains a very good and long-lasting relationship with PayPal, apparently didn’t manage to get the deal. The same goes for European Bitstamp, which provides crypto services to Revolut in the U.K.

Range of Crypto Services offered by PayPal Remains Unclear

Both Paxos and PayPal declined to comment on the news, therefore it remains unclear when and to which extent PayPal will roll out its crypto services. A few days ago was reported that PayPal disclosed that it is working on offering cryptocurrency buying and selling to 325 million of its and Venmo’s (which is PayPal’s subsidiary) users in a letter to the European Commission. However, according to CoinDesk, only a portion of the users will have access to the crypto features at launch.

The latest developments in the fintech industry show that cryptocurrency services are slowly becoming a must-have feature of challenger-bank applications looking to grow their revenue and userbase.