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Last year, PayPal customers were given the opportunity to buy, store, sell and transfer some cryptocurrencies: Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH) and Litecoin (LTC).
Let us recall that the American corporation PayPal launched the first crypto service in its application back in the fall of 2020. However, the functionality was cut back then and did not provide any particular advantage over digital solutions of crypto exchanges. In particular, users were prohibited from withdrawing assets to third-party platforms.
Users of the service received this opportunity in the summer of 2022. The press service then noted that in order to use tokens in everyday transactions, you should fill out the W-9 tax form, which is added in a special section of the service.
The program offers custody services (when the service owns the private key of your wallet and stores assets) and educational materials. When making payments, the application automatically converts fiat money on the balance into crypto assets and vice versa.
“Adding the ability to transfer, send, and receive cryptocurrency is another step toward creating a more inclusive and efficient financial system. We’re excited to connect PayPal customers to other wallets, exchanges, and apps, and we’ll continue to roll out additional crypto features, products, and services in the coming months,” said José Fernandes da Pont, senior vice president and general manager of blockchain, cryptocurrency, and digital currencies at PayPal, after the innovation was unveiled.
How to buy cryptocurrency
Of course, to use crypto assets on PayPal, you need to buy them first. This can be done through the PayPal platform (for UK and US residents) as well as on other exchanges, in particular those that allow deposits via PayPal (the most popular in this case are eToro and Coinbase).
If you buy cryptocurrency on other platforms using your PayPal account, the process is basically the same:
1. Choose a cryptocurrency exchange that accepts PayPal deposits and register.
2. Create an account and verify your identity. Provide the required personal information (email address, contact number, etc.).
3. Make a deposit via PayPal. To do this, go to the "bank" or "account" tab, enter the deposit amount and click on PayPal. The system will then redirect you to the financial giant's website, where you need to log in to confirm the transaction.
4. Search for the required cryptocurrency (for example, Bitcoin) and enter the order data. Select the currency for payment, for example, BTC/USD, if it is replenished with dollars.
5. Enter the details of the transaction (how much crypto we buy, at the actual rate - "market order", or when the price reaches a certain level - "limit order"). Check the details and click "buy", confirming the transaction.
How to get cryptocurrency on PayPal
To receive crypto on PayPal (by buying on exchanges or receiving from users), you need to go to the "Finance" tab, click on your own cryptocurrency balance, then click on the Transfer arrows (which look in different directions), select "Receive". Then you can select the coin you want to receive, for example, BTC. Then your QR code and bitcoin address will appear.
How to Buy Cryptocurrency on PayPal
To avoid using crypto exchanges or P2P services, you can buy one of the four cryptocurrencies available on PayPal directly on this platform. To do this:
1. Create a PayPal account.
This is a prerequisite for purchasing cryptocurrencies through the platform. To create an account, you need to provide an email address and a mobile phone number. You can also download the PayPal app on your smartphone. PayPal accounts are free, so you don’t have to pay anything to register and start trading crypto.
2. Link PayPal to your bank account or card.
You can fund your new account with a card payment or link it to your current bank account. Either way, you'll need to set up some way to access your money.
You won't have to pay any transaction fees to deposit money.
3. Go to the PayPal "Discover Crypto" section.
This main page allows you to learn more about cryptocurrency and how to trade it safely. It also provides a list of the four available cryptocurrencies, and you need to select one of them to begin the purchase process.
4. Click the button, for example, Bitcoin.
On the Bitcoin page, you'll see basic information about the coin, such as its price, historical data, and a brief description of how it works. Click the "buy" button or select one of the fixed amounts below it to make a purchase. When you make your first purchase, you'll be asked to answer a few questions about your financial status, tax status, and to verify your identity.
5. Complete the Bitcoin purchase transaction using PayPal.
Confirm the details of your trade: how much you want to spend, how many bitcoins you want to receive, and when you want the trade to take place. Then execute the transaction. Click on the “wallet” tab in the main menu to see your bitcoins in your portfolio.
How to Buy Cryptocurrency with PayPal on eToro
How to send money from PayPal to a crypto wallet
To do this, log in to PayPal, the "Finance" section. Next, click on your crypto balance. Then:
Answers to current questions
Can I store Bitcoin in PayPal crypto wallet?
Yes, of course. However, PayPal is limited as a crypto wallet. It does not offer the same security as a dedicated wallet that is self-hosted (where only you can access your money with your private key). The PayPal wallet is a good option for beginners who hold small amounts of crypto, but those who are investing more should consider something more secure.
The eToro wallet is one option, although there are also good, cheap storage options such as Coinbase and through the MetaMask service.
Can I buy other cryptocurrencies with PayPal?
There are four cryptocurrencies available on PayPal. Bitcoin is the most popular, but there are three others you can also buy:
How much does PayPal charge to buy and sell Bitcoin?
PayPal is one of the most expensive ways to buy cryptocurrency. You can expect to pay around 2% for each transaction, although cheaper rates are offered for larger transactions. Here are PayPal's fees.
Coinbase and eToro, for example, charge just 1% fees on crypto transactions.
Which is better: buying bitcoin through PayPal or on cryptocurrency exchanges?
A cryptocurrency exchange is almost always the best option. It’s cheaper and there are more payment methods. The wallets offered by eToro and Coinbase are also safer than the PayPal wallet if you want to store your coins.
Buying cryptocurrency through PayPal is an option for beginners, as it is a convenient way to purchase your first coins. However, PayPal has significant restrictions as a cryptocurrency exchange, and you must complete a full identity check and answer questions about your tax status to be approved for purchase.
PayPal has no analysis tools and no means of exchanging between cryptocurrencies. You cannot use another cryptocurrency, such as ETH, to buy BTC, and vice versa. Likewise, a Bitcoin wallet is much less secure than any standard crypto wallet, where you retain control over your own private keys.
Let us recall that the American corporation PayPal launched the first crypto service in its application back in the fall of 2020. However, the functionality was cut back then and did not provide any particular advantage over digital solutions of crypto exchanges. In particular, users were prohibited from withdrawing assets to third-party platforms.
Users of the service received this opportunity in the summer of 2022. The press service then noted that in order to use tokens in everyday transactions, you should fill out the W-9 tax form, which is added in a special section of the service.
The program offers custody services (when the service owns the private key of your wallet and stores assets) and educational materials. When making payments, the application automatically converts fiat money on the balance into crypto assets and vice versa.
“Adding the ability to transfer, send, and receive cryptocurrency is another step toward creating a more inclusive and efficient financial system. We’re excited to connect PayPal customers to other wallets, exchanges, and apps, and we’ll continue to roll out additional crypto features, products, and services in the coming months,” said José Fernandes da Pont, senior vice president and general manager of blockchain, cryptocurrency, and digital currencies at PayPal, after the innovation was unveiled.
How to buy cryptocurrency
Of course, to use crypto assets on PayPal, you need to buy them first. This can be done through the PayPal platform (for UK and US residents) as well as on other exchanges, in particular those that allow deposits via PayPal (the most popular in this case are eToro and Coinbase).
If you buy cryptocurrency on other platforms using your PayPal account, the process is basically the same:
1. Choose a cryptocurrency exchange that accepts PayPal deposits and register.
2. Create an account and verify your identity. Provide the required personal information (email address, contact number, etc.).
3. Make a deposit via PayPal. To do this, go to the "bank" or "account" tab, enter the deposit amount and click on PayPal. The system will then redirect you to the financial giant's website, where you need to log in to confirm the transaction.
4. Search for the required cryptocurrency (for example, Bitcoin) and enter the order data. Select the currency for payment, for example, BTC/USD, if it is replenished with dollars.
5. Enter the details of the transaction (how much crypto we buy, at the actual rate - "market order", or when the price reaches a certain level - "limit order"). Check the details and click "buy", confirming the transaction.
How to get cryptocurrency on PayPal
To receive crypto on PayPal (by buying on exchanges or receiving from users), you need to go to the "Finance" tab, click on your own cryptocurrency balance, then click on the Transfer arrows (which look in different directions), select "Receive". Then you can select the coin you want to receive, for example, BTC. Then your QR code and bitcoin address will appear.
How to Buy Cryptocurrency on PayPal
To avoid using crypto exchanges or P2P services, you can buy one of the four cryptocurrencies available on PayPal directly on this platform. To do this:
1. Create a PayPal account.
This is a prerequisite for purchasing cryptocurrencies through the platform. To create an account, you need to provide an email address and a mobile phone number. You can also download the PayPal app on your smartphone. PayPal accounts are free, so you don’t have to pay anything to register and start trading crypto.
2. Link PayPal to your bank account or card.
You can fund your new account with a card payment or link it to your current bank account. Either way, you'll need to set up some way to access your money.
You won't have to pay any transaction fees to deposit money.
3. Go to the PayPal "Discover Crypto" section.
This main page allows you to learn more about cryptocurrency and how to trade it safely. It also provides a list of the four available cryptocurrencies, and you need to select one of them to begin the purchase process.
4. Click the button, for example, Bitcoin.
On the Bitcoin page, you'll see basic information about the coin, such as its price, historical data, and a brief description of how it works. Click the "buy" button or select one of the fixed amounts below it to make a purchase. When you make your first purchase, you'll be asked to answer a few questions about your financial status, tax status, and to verify your identity.
5. Complete the Bitcoin purchase transaction using PayPal.
Confirm the details of your trade: how much you want to spend, how many bitcoins you want to receive, and when you want the trade to take place. Then execute the transaction. Click on the “wallet” tab in the main menu to see your bitcoins in your portfolio.
How to Buy Cryptocurrency with PayPal on eToro
- eToro is the most popular crypto broker and the easiest platform for beginners. So, to buy, for example, Bitcoin:
- Log in to your eToro account and click “Fund Account”;
- Enter the deposit amount and select PayPal from the list of options;
- Find Bitcoin, click "trade" and check the details before confirming the purchase;
- eToro does not charge a fee for deposits made via PayPal, but withdrawals incur a general fee of $5 and you must withdraw at least $30.
How to send money from PayPal to a crypto wallet
To do this, log in to PayPal, the "Finance" section. Next, click on your crypto balance. Then:
- click on the image of the oncoming arrows Transfer, "Send" (here you can sync your PayPal contacts to send them crypto);
- select the contact you want to send the crypto to, or enter an external crypto address / scan a QR code;
- Enter the amount you want to send and click Next;
- check the correctness of the entered data, if the cryptocurrency is sent to the wrong address, it will be lost without the possibility of return;
- confirm the transaction.
Answers to current questions
Can I store Bitcoin in PayPal crypto wallet?
Yes, of course. However, PayPal is limited as a crypto wallet. It does not offer the same security as a dedicated wallet that is self-hosted (where only you can access your money with your private key). The PayPal wallet is a good option for beginners who hold small amounts of crypto, but those who are investing more should consider something more secure.
The eToro wallet is one option, although there are also good, cheap storage options such as Coinbase and through the MetaMask service.
Can I buy other cryptocurrencies with PayPal?
There are four cryptocurrencies available on PayPal. Bitcoin is the most popular, but there are three others you can also buy:
- Ethereum (ETH);
- Litecoin (LTC);
- Bitcoin Cash (BCH).
How much does PayPal charge to buy and sell Bitcoin?
PayPal is one of the most expensive ways to buy cryptocurrency. You can expect to pay around 2% for each transaction, although cheaper rates are offered for larger transactions. Here are PayPal's fees.
Coinbase and eToro, for example, charge just 1% fees on crypto transactions.
Which is better: buying bitcoin through PayPal or on cryptocurrency exchanges?
A cryptocurrency exchange is almost always the best option. It’s cheaper and there are more payment methods. The wallets offered by eToro and Coinbase are also safer than the PayPal wallet if you want to store your coins.
Buying cryptocurrency through PayPal is an option for beginners, as it is a convenient way to purchase your first coins. However, PayPal has significant restrictions as a cryptocurrency exchange, and you must complete a full identity check and answer questions about your tax status to be approved for purchase.
PayPal has no analysis tools and no means of exchanging between cryptocurrencies. You cannot use another cryptocurrency, such as ETH, to buy BTC, and vice versa. Likewise, a Bitcoin wallet is much less secure than any standard crypto wallet, where you retain control over your own private keys.
