Later on Tuesday, PayPal Holdings Inc will reveal that it has started allowing U.S. customers to use their cryptocurrency holdings to pay at millions of its online retailers around the world, a step that will dramatically increase the use of digital assets in daily commerce.
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PayPal customers with bitcoin, ether, bitcoin currency, and litecoin in their digital wallets will be able to turn their holdings into fiat currencies at checkouts to make transactions, according to the company.
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PayPal users will be able to choose from bitcoin, litecoin, ethereum, or bitcoin cash when using the Checkout with Crypto feature, according to the company. Depending on the types of crypto holdings they have and if they have enough to support a given order, they will be able to pick their favourite cryptocurrency at checkout.
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PayPal has stated that it would not charge a transaction fee to customers who pay with cryptocurrency, and that a conversion spread will be integrated into the crypto-to-dollar conversion.
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“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,” President and CEO Dan Schulman told Reuters.
Bitcoin’s value has nearly doubled since the beginning of the year, thanks to increased interest from larger financial institutions betting on greater acceptance and seeing it as a hedge against inflation.
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PayPal’s announcement comes less than a week after Tesla Inc announced that it would accept bitcoin payments for its electric cars. Unlike PayPal transactions, where merchants receive fiat currency, Tesla has stated that the bitcoin used as payment will be held by the company.