PayPal Expands Crypto P2P: Bitcoin, Ethereum & Stablecoins
PayPal Embraces Crypto P2P Payments
Payment systems are undergoing a significant transformation, with stablecoins and cryptocurrencies playing an increasingly central role. PayPal's latest update reflects this shift, expanding its peer-to-peer (P2P) ecosystem to include crypto assets.
Users can now send and request money via chats, texts, emails, and directly to PayPal, Venmo, and crypto wallets. This expansion includes support for Bitcoin (BTC), Ethereum (ETH), and stablecoins like PYUSD.
"This will make it more convenient for PayPal users in the U.S. to send Bitcoin, Ethereum, PYUSD, and more."
This move aligns PayPal with other major players like Stripe, Visa, Western Union, and MoneyGram, which have either adopted or plan to integrate stablecoin and crypto support.
Why the Focus on Stablecoins?
Stablecoins offer several advantages, particularly in cross-border payments. Traditional payment corridors, especially in Africa and Asia, can incur fees as high as 12% with settlement times of over three days. Stablecoin transactions, on the other hand, can cost mere pennies and settle almost instantly. The World Bank estimates that stablecoins could reduce remittance costs by over 90%.
Key Takeaways:
- Why expand crypto P2P? To remain competitive and streamline money transfers. The integration of stablecoins indicates a broader acceptance among established financial institutions.
- The ultimate goal? PayPal aims to attract non-crypto users by offering convenient and cost-effective payment options. This intensifies competition in the payments sector.
AMBCrypto reported that crypto-focused payment providers like BitPay and Yellow Card are seeing increased preference for stablecoins in remittances. In addition to legacy firms, crypto platforms such as Binance Pay, Bybit Pay, and Kraken (with 'Krak') are also expanding into cross-border payments, supporting various assets including USDC and USDT.
While it remains unclear if PayPal will support stablecoins beyond its own PYUSD, David Weber, head of PYUSD, emphasized that the update is designed to attract individuals new to crypto.
Currently, PYUSD ranks as the 10th largest stablecoin with a market capitalization of $1.25 billion. In comparison, USDC holds the second-largest position at $72 billion, while USDT leads with $170 billion. The overall stablecoin market is approaching $290 billion, marking a growth of approximately $40 billion recently.