PayPal has started allowing people to pay for things using cryptocurrency on its platform, the company announced today.
The online payment platform is used by around 29 million merchants and the new cryptocurrency payment service, called Checkout with Crypto, will be expanded to all of them in the coming months, PayPal said.
It will work by converting cryptocurrency into fiat currency, which is what the merchant will receive.
There will be no additional transaction fees associated with making payments in this way, and all transactions are settled in USD and converted to other global currencies using PayPal's standard rates, the company said in a statement.
The option of paying with cryptocurrency should automatically appear in a user's PayPal wallet at checkout if they have enough to pay for whatever they are buying.
Users will then be able to choose the cryptocurrency they want to pay with. For now, the service will only be available for four cryptocurrencies—Bitcoin, Ether, Bitcoin Cash, and Litecoin.
PayPal already allows people to buy and sell those four cryptocurrencies using its platform—a service it launched in October last year.
Dan Schulman, CEO of PayPal, said: "As the use of digital payments and digital currencies accelerates, the introduction of Checkout with Crypto continues our focus on driving mainstream adoption of cryptocurrencies, while continuing to offer PayPal customers choice and flexibility in the ways they can pay using the PayPal wallet.
"Enabling cryptocurrencies to make purchases at businesses around the world is the next chapter in driving the ubiquity and mass acceptance of digital currencies."
Schulman also told Reuters: "This is the first time you can seamlessly use cryptocurrencies in the same way as a credit card or a debit card inside your PayPal wallet."
PayPal's announcement comes just one day after card company Visa said it would allow customers to use the USDC cryptocurrency to settle transactions.
USDC, or USD Coin, is known as a stablecoin because its value is tied to the price of the US dollar. It means that anyone holding a USD Coin will be able to trade each one for one US dollar.
And on March 24, Tesla CEO Elon Musk announced customers could purchase certain Tesla models in the U.S. using Bitcoin.
Unlike PayPal, Tesla does not convert the Bitcoins into fiat currency but keeps them as they are. Musk said the policy would roll out to countries other than the U.S. later this year but did not specify a date.
Update 3/30/21, 8:15 a.m. ET: This article has been updated to include more information from PayPal's press release.
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