Payment processor PayPal will allow users to transfer their crypto to external wallets and exchanges, according to a statement from Jose Fernandez da Ponte, Senior Vice President at the company. The new feature was highly demanded by the users, the executive confirmed.
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Per a report from TechCrunch, the general manager of blockchain, crypto, and digital currencies at PayPal, da Ponte said:
This feature was the most demanded from our users since we began offering the purchase of crypto on our platform.
In the past, PayPal users were allowed to purchase Bitcoin, Ethereum, Litecoin, and other cryptocurrencies. Initially, users were only allowed to hold the digital assets as a way to gain exposure to their prices.
Eventually, PayPal announced it was going to enable crypto funds to pay for products and services. This crypto-check-out feature was the latest step, until now, in the company’s strategy to expand into the digital asset sector.
The newest crypto withdrawal feature will provide users with more freedom. However, they will have to pay for any 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, a transaction fee can double the original amount which makes it one of the most expensive blockchains.
PayPal to PayPal transfers will remain feeless for the users, but people will need to complete an additional layer of identity verification. The external withdrawal functionality will be progressively available across the U.S. Fernandez da Ponte added:
If users have crypto somewhere else and want to consolidate, they can bring it to PayPal from external addresses. They can also send crypto to anyone who is in the PayPal system.
The executive hinted at this new feature last year. Fernandez da Ponte, as he told TechCrunch, believes the ability to send and receive crypto transactions is a natural step for the platform and an improvement for the users “who want to do more with their digital assets”.
What PayPal’s Crypto Initiative Meant For The Sector
The payment processor announced its crypto offering back in October 2020. At this time, the news was considered one of the main catalyzers for a Bitcoin bull-run which took the cryptocurrency from a yearly low at $3,500 to over $65,000 in the subsequent months.
PayPal letting its users buy, sell and hold digital assets was the first announcement in a new adoption trend that saw the first publicly traded company in the U.S. integrating BTC into their balance sheet, and the world’s biggest company adopting it as a payment method.
Fernandez da Ponte told TechCrunch that the company wants to serve as a bridge for users to transact between the fiat world and the digital asset world. He said:
We see ourselves as a conduit between the fiat, or traditional finance, environment and the Web3 environment. We are enabling connectivity to other wallets, exchanges and applications.
The crypto market almost grew to a $3 trillion market cap from the time PayPal first announced its digital assets service to 2021 when the company launched its crypto-checkout service. Lately, the sector has lost over 50% of its value.
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However, Fernandez da Ponte claims the company has long terms plans for the space:
This move shows we’re in this for the long term. I think it’s important to stay the course and continue to invest in the space.