PayPal considers enabling self-custody option, supporting withdrawal of Bitcoin and other cryptocurrencies.

Global payment giant PayPal has been criticized by the cryptocurrency community for the inability to withdraw funds since launching its cryptocurrency trading service. However, according to the company's blockchain lead's remarks at a consensus conference, it appears that PayPal is considering opening up withdrawals for users.

PayPal Expected to Enable Withdrawals

At the end of October 2020, PayPal announced the launch of cryptocurrency trading features and made it available to all US users in mid-November. However, at that time, many in the community were disappointed as PayPal seemed to adopt a mechanism similar to online brokerage Robinhood to avoid compliance issues, where the cryptocurrencies bought on PayPal cannot be transferred between accounts or withdrawn from the PayPal platform. This means that users do not actually own the cryptocurrencies they purchased but rather a form of "ownership."

However, based on information revealed by Jose Fernandez da Ponte, PayPal's VP of Global Business Development and Head of Blockchain at the 2021 Consensus conference organized by CoinDesk, it seems that this mechanism may undergo some changes. The Head of Blockchain at PayPal mentioned during the conference:

"We want to make it as open as possible and we expect to give our consumers more choices, so they can take the crypto they acquire with us and take it to the destination of their choice."

Additionally, Jose Fernandez da Ponte also stated that PayPal and its other services will become a natural way for future government-distributed central bank digital currencies (CBDCs) and stablecoins. When asked about the possibility of PayPal issuing its own stablecoin, the executive gave a negative response, stating:

"It's too early for that."

Cryptocurrency Boosts PayPal's Revenue Growth

According to previous reports, PayPal reported impressive results for the first quarter released in May, attributed not only to the increase in cashless payments due to the COVID-19 pandemic but also to the decision to launch cryptocurrency-related services.

During the company's earnings call, PayPal CEO Dan Schulman stated that the company generated $6.033 billion in revenue in the first quarter, marking the strongest year in PayPal's history. Schulman highlighted that the first quarter was the strongest quarter ever, setting record financial and operational performance. Schulman attributed this stellar performance to the company's cryptocurrency initiatives:

"Through our efforts in cryptocurrency, we’ve achieved some really great results strategically."

The CEO of the payment giant further indicated that as wealth shifts and cryptocurrency matures, the volume of cryptocurrency business will continue to grow over time. The company also plans to launch the next generation of digital wallets in the third quarter and accelerate customer digital engagement over the next year through rapid innovations in the wallet and e-commerce platform.