In the United States, PayPal users can utilize the platform to directly buy Bitcoin, but there are still some restrictions.
You can buy Bitcoin and other cryptocurrencies with PayPal if you're in the United States.
The feature is rolled out to "certain overseas markets" in the first half of 2021.
PayPal's digital wallet does not allow for the transfer of Bitcoin purchased on PayPal.
As of November 2020, PayPal will allow all US account holders to buy and sell Bitcoin and other cryptocurrencies on its platform. The statement came as a follow-up to the company's announcement in October 2020 that it would be partnering with Paxos Crypto Brokerage to offer cryptocurrency trading opportunities.
Bitcoin, Ethereum, Bitcoin Cash, and Litecoin can all be purchased with PayPal's digital wallet, which is a convenient feature for many users.
Users in the US will soon be able to pay for goods from PayPal's 26 million merchants around the world with cryptocurrencies, the company said in a brief statement. "We are happy to announce that customers in the United States who meet the eligibility requirements can now use PayPal to buy, hold or trade cryptocurrencies." There will be an exchange of funds for fiat currency at the moment of sale.
According to PayPal's announcement at the time, "certain international markets" would be able to purchase and sell cryptocurrencies, and in August 2021, UK users were allowed to buy, sell, and hold Bitcoin.
A "cash back into crypto" feature for consumers was implemented to PayPal's social payment service Venmo in August 2021 as well.
PayPal users are increasingly turning to cryptocurrency purchases, and this is helping PayPal's payments service hit new highs in the first quarter of 2021. So, where do you begin?
With PayPal, how can I buy Bitcoins?
To begin, here are the essentials: Obviously, you'll need a PayPal account. To use PayPal, you'll need an email address and a credit card or bank account.
It's time to purchase some Bitcoins. PayPal's website and mobile app offer a very comparable user experience, so we'll focus on the website for this tutorial. There are several ways to buy Bitcoin and other digital currencies through this app's "Payments" page.
Next, choose the cryptocurrency you want to invest in. Bitcoin, Ethereum, Bitcoin Cash, and Litecoin are currently the only cryptocurrencies that may be purchased and sold on PayPal. PayPal also provides information on how to learn more about cryptocurrencies, as well as the associated dangers.
Preset amounts of Bitcoin can be purchased, or you can touch "Buy" to choose an amount of your own. Users can purchase as low as $1 worth of Bitcoin, up to a weekly cap of $100,000. An asset description appears beneath the buy option in the PayPal shopping cart.
Please read and accept PayPal's Terms & Conditions for Cryptocurrencies before you may proceed.
After that, it's time to acquire some Bitcoin. Specify the amount (in this case, $10) you'd want to purchase. According to this remark, the price of Bitcoin fluctuates according to the time of purchase: "Until you buy or sell, the exchange rate contains a spread and is refreshed often." To proceed to the next screen, click Next.
The bank account or credit/debit card linked to your PayPal account is displayed. At this time, you can also add other cards or bank accounts.
Re-confirm your purchase when you click "Next". For consumer-to-consumer transactions, PayPal's transaction fees are minimal, ranging from 50 cents for sales under $25 to 1.5 percent of the transaction for purchases over $1,000. When you're ready to buy, click "Buy Now.".
Immediately after the transaction is completed, the account will be updated to reflect the quantity of cryptocurrency purchased and the current market value.
You may view your Bitcoin purchase under "crypto" on the home page, where you can buy or sell it.
The user's Cash Account balance will indicate the amount of fiat currency that the user has sold using the PayPal app or website. PayPal has provided a fee chart and conversion spread for users to see how much they may be charged.
Using PayPal to purchase Bitcoin on other websites
In the beginning, PayPal only allowed users to buy, sell, and hold cryptocurrency. There were a lot of people who believed in Bitcoin who argued that PayPal's crypto features were in direct opposition to the entire premise of bitcoin, which is that its users are their bank.
Since then, PayPal has softened its position, saying in May 2021 that it will begin supporting third-party wallets. Until then, you can only use PayPal's digital wallet to make purchases (in which case the crypto is turned into fiat at the point of sale) and you can't transfer crypto out of the wallet.
To keep complete ownership of your Bitcoin, if you want to use PayPal to buy Bitcoin from other sources such as exchanges, your options are limited; only a few sites accept it.
When a transaction goes awry and a buyer wants a refund, PayPal and other credit card firms allow the customer to file a chargeback. In this way, a buyer can claim that a transaction was fraudulently completed, get their money back, and still obtain their Bitcoin. Because Bitcoin is pseudonymous, PayPal is unable to verify whether or not a dispute is genuine. As a result, PayPal usually takes the side of the buyer.
In the event of a fraudulent dispute, the seller will be out of pocket while the buyer keeps the Bitcoin and the chargeback because Bitcoin transactions are irreversible.
There are some workarounds available for those who want to buy Bitcoin using PayPal but keep the ability to move their bitcoin.