Payment processor PayPal will allow users to transfer their crypto to external wallets and exchanges, according to a statement from Jose Fernandez da Ponte, the company’s senior vice president. The new feature was highly requested by users, the executive confirmed.
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According to a report from TechCrunch, Managing Director of Blockchain, Crypto and Digital Currencies at PayPal, da Ponte said:
This feature was the most requested by our users since we started offering the purchase of crypto on our platform.
In the past, PayPal users were allowed to buy Bitcoin, Ethereum, Litecoin, and other cryptocurrencies. Initially, users were only allowed to hold the digital assets to gain exposure to their prices.
Eventually, PayPal announced that it was going to allow crypto funds to pay for products and services. This crypto-checkout feature was the latest step, so far, in the company’s strategy to expand into the digital asset space.
The new crypto withdrawal feature will give users more freedom. However, they will have to pay network fees when sending a transaction from their PayPal accounts to external wallets.
These transaction fees vary from blockchain to blockchain. On Ethereum, when network congestion is high, transaction fees can double the initial amount, making it one of the most expensive blockchains.
PayPal to PayPal transfers will remain easy for users, but users will need to complete an additional layer of identity verification. External Withdrawal functionality will gradually be available across the United States. Fernandez da Ponte added:
If users have crypto elsewhere and want to consolidate it, they can bring it to PayPal from external addresses. They can also send crypto to anyone in the PayPal system.
The executive hinted at this new feature last year. Fernandez da Ponte, as he told TechCrunch, thinks the ability to send and receive crypto transactions is a natural step for the platform and an improvement for users “who want to do more with their digital assets. “.
What PayPal’s crypto initiative meant for the industry
The payment processor announced its crypto offering in October 2020. At that time, the news was seen as one of the main catalysts for a Bitcoin bull run that took the cryptocurrency from a yearly low of 3 $500 to over $65,000 in subsequent months.
PayPal allowing its users to buy, sell and hold digital assets was the first announcement of a new adoption trend that saw the first publicly traded company in the United States integrate BTC into its balance sheet, and the largest company in the world to adopt it as a method of payment.
Fernandez da Ponte told TechCrunch that the company wants to act as a bridge for users to transact between the fiat world and the world of digital assets. He said:
We see ourselves as an intermediary between the fiat environment, or traditional finance, and the Web3 environment. We enable connectivity to other wallets, exchanges and apps.
The crypto market has nearly reached a market capitalization of $3 trillion from the time PayPal first announced its digital asset service until 2021 when the company launched its crypto payment service. Lately, the sector has lost more than 50% of its value.
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However, Fernandez da Ponte says the company has long-term plans for the space:
This decision shows that we are here for the long haul. I think it’s important to stay the course and continue to invest in space.