In this beginner guide, we’ll take you through the ins and outs of buying and selling cryptocurrency with PayPal. So you can make an informed decision whether PayPal is the right platform for you to buy and sell crypto.
In today’s digital age, cryptocurrency is becoming an increasingly popular investment option. And with the launch of PayPal’s cryptocurrency feature in August 2022, buying and selling digital assets has never been easier.
Whether you’re a seasoned crypto investor or just starting out, PayPal’s cryptocurrency functionality offers a convenient way to purchase, store, and transfer digital currencies such as Bitcoin, Ethereum, Litecoin, and Bitcoin Cash.
However, before you dive in, it’s essential to understand the platform’s fees, limitations, and protections.
What is PayPal?
PayPal is an online payment system that allows you to pay for things online and send and receive money safely and securely. With PayPal, you can link your bank account, credit card or debit card to your account, which enables you to make purchases with participating merchants online. PayPal acts as a mediator between your bank and the merchant, ensuring the security of your payment information.
In addition to online purchases, PayPal also offers a convenient way to send and receive money to and from friends and family. Whether it’s splitting rent with roommates or receiving birthday money from loved ones, PayPal makes it easy to transfer funds securely.
With its user-friendly interface and robust security measures, PayPal is a reliable and trustworthy payment platform that has become a go-to choice for millions of users worldwide.
PayPal Adds Cryptocurrency
Due to customer demand, PayPal announced it would allow customers to transfer cryptocurrency from their accounts to other wallets and exchanges. The new feature enabled customers to transfer supported coins into PayPal, send crypto to other PayPal users and move crypto from its app to external crypto addresses, including exchanges and hardware wallets.
Internal crypto transfers, such as PayPal to PayPal, would have no fees. PayPal’s new feature was initially launched to its U.S. users, and an additional identity verification process is required before users can transfer any crypto.
What can you do with Crypto on PayPal?
Depending on your location, you can do several things with cryptocurrency on PayPal. Such as sending and receiving crypto to and from an eligible PayPal account. Buy, hold, and sell cryptocurrency and use the proceeds from selling cryptocurrency to pay for purchases through a PayPal account with Checkout with Crypto. Plus, transferring cryptocurrencies between other wallets and exchanges.
You can find the Terms and Conditions and Acceptable Use Policy by going to PayPal Legal.
What are PayPal Crypto Fees?
When buying or selling cryptocurrency through PayPal, users are subject to a margin or “spread” of around 0.5% on top of the market price.
Additionally, PayPal charges the below transaction fees based on the purchase amount.
|$1.00 – $4.99||$0.49|
|$5.00 – $24.99||$0.99|
|$25.00 – $74.99||$1.99|
|$75.00 – $200.00||$2.49|
|$200.01 – $1,000.00||1.80%|
What Cryptocurrency does PayPal Support?
PayPal currently supports a limited number of cryptocurrencies, with the potential to add more in the future. If you have crypto available on PayPal in your location, you will be able to buy, sell and transfer Bitcoin, Ethereum, Litecoin, and Bitcoin Cash.
Does PayPal Offer any Protections on Crypto?
Crypto funds on PayPal are not eligible for Federal Deposit Insurance Corp. coverage. PayPal Buyer Protection also doesn’t apply to cryptocurrency purchases, but crypto purchases may be protected from unauthorized activity. In case of an unauthorized transfer, you may be eligible for reimbursement up to the equivalent of $50,000.
PayPal has made buying and selling cryptocurrency much more accessible to the average consumer. While it may not be the cheapest option available, the convenience and simplicity of the platform make it an attractive choice, particularly for those new to the world of cryptocurrency.
Whether you’re looking to invest or just want to experiment with crypto, PayPal’s user-friendly interface makes it a great option if you are okay with paying a higher transaction fee.
The fees for buying or selling cryptocurrencies on PayPal are competitive with those of major exchanges such as Coinbase.com. However, there are other more advanced exchanges like OKX and Binance that may offer lower fees for buying and selling cryptocurrency.
But PayPal does make buying Bitcoin very convenient, although a little pricy. Ultimately, whether PayPal is a good place to buy Bitcoin depends on your individual preferences and needs.