Three billion users within reach! PayPal and Venmo rumored to launch cryptocurrency trading services

According to an anonymous source cited by CoinDesk, global payment giant PayPal and its subsidiary Venmo may soon offer cryptocurrency buying and selling services. While PayPal briefly participated in Facebook's Libra project in the past, this potential integration with cryptocurrencies has not been officially confirmed yet but has caught the attention of the wider crypto community.

How Does It Work Specifically?

It is reported that after integrating cryptocurrency buying and selling services, PayPal will allow users to directly connect with third-party cryptocurrency exchanges (such as rumored Coinbase and Bitstamp), enabling them to purchase Bitcoin and other altcoins through their online accounts. An anonymous source who exposed the news stated:

My understanding is that they will allow users to buy and sell cryptocurrencies directly from PayPal and Venmo, providing some kind of built-in wallet functionality so that users can also store their crypto assets there. PayPal will integrate with various exchanges to provide high liquidity cryptocurrency trading and they may officially launch this feature within the next three months.

The anonymous source pointed out that major exchanges Coinbase and Bitstamp could be potential partners, but both of them as well as PayPal have declined to comment on this news.

PayPal's Belief in the Cryptocurrency Space

In fact, as early as 2014, PayPal established partnerships with three Bitcoin payment service providers including Coinbase (BitPay, Coinbase, and GoCoin). In 2018, Coinbase offered PayPal's instant fiat withdrawals to U.S. users, and later extended the PayPal withdrawal service to users in Europe and Canada last year.

PayPal CEO Dan Schulman has also clearly stated this year that they will continue to drive the monetization of Venmo, with Venmo processing over $29 billion in payments in the fourth quarter of 2019, a 56% increase from the same period last year. He emphasized that expanding Pay With Venmo will be a key focus in the future.

PayPal's CTO Sri Shivananda also mentioned in an interview with CoinDesk earlier this year that they hope PayPal can have its own perspective and views on blockchain technology in order to understand how to use this technology to build an open digital payment platform and serve the public. He stated:

We strongly believe in the potential of blockchain. It's not a question of if, but when the digitization of currency will happen.

In fact, PayPal had a job opening for a crypto engineer at the end of last month, with the job location in Chennai, a coastal city in southeastern India and a major IT hub in the country. The job description included: "The role involves designing, developing, and maintaining critical cryptographic products/features to be used effectively at PayPal."

However, it is currently unknown if this is related to the introduction of cryptocurrency trading.

Cryptocurrency Community's Viewpoint

The integration by PayPal could potentially bring cryptocurrencies to its 325 million active users and further global adoption. However, some in the cryptocurrency community have pointed out that a few years ago, the integration between Coinbase and PayPal caused a stir, but this news may be forgotten by the public within a few days.

Larry Cermak, Research Director at The Block, who always has the latest news in the crypto space, stated:

The news from CoinDesk is a bit slow, I already knew about this news about a month ago, and while it should be true, it may still take some time before PayPal's cryptocurrency trading service is officially implemented.

Regardless, the biggest beneficiaries may still be bullish cryptocurrency investors. Following the rumors of PayPal's integration, Bitcoin surged from $9,400 to $9,800, reaching $9,612 at the time of writing, with a 2.37% increase in the past 24 hours.