Consumers in the US could soon be able to make cross-border purchases using more than 100 cryptocurrencies, following the launch of PayPal’s new Pay with Crypto Service.
Announced on July 28, the service enables merchants to convert crypto or stablecoins they have received as part of transactions into fiat currencies via wallets, such as Coinbase and MetaMask.
The solution will become available to US merchants “in the coming weeks” and supports payments with Bitcoin, ETH, USDT, XRP, USDC and more. Pay with Crypto is still subject to the approval of the New York State Department of Financial Services (NYDFS).
PayPal revealed it is seeking to help solve the global cross border fee issue with its latest digital currency product. The financial service company stated Pay with Crypto will see the standard international credit card processing fee attached to cross border payments drop by 90% to 0.99%.
With digital currencies becoming more widely accepted in the last year by traditional financial institutions, PayPal is seeking to provide a unified platform which supports digital currencies alongside traditional fiat payment methods.
“Businesses of all sizes face incredible pressure when growing globally, from increased costs for accepting international payments to complex integrations. Today, we’re removing these barriers and helping every business of every size achieve their goals,” said Alex Chriss, President and CEO of PayPal.
Cross-border breakthrough?
While cross-border payments provide valuable access to new markets for businesses seeking to scale their international operations, they also come with several friction points.
Some of the most prevalent issues relate to high costs due to fluctuating FX rates, as well as slow transaction speeds due to the involvement of several intermediaries. There is also limited access as cross-border payments are not offered by a wide range of financial firms.
As these issues continue to stem, digital currencies, particularly stablecoins, have been quietly emerging as a potential solution, which is one of the reasons why PayPal launched its native stablecoin PYUSD in August 2023. This was a landmark move as PayPal became one of the first major financial service providers to offer its own stablecoin.
PayPal will make its own stablecoin, PYUSD, available as part of Pay with Crypto. The payment giant says it wants to enable US merchants to send “faster, low-cost payments to freelancers and vendors using PYUSD”.
“Imagine a shopper in Guatemala buying a special gift from a merchant in Oklahoma City. Using PayPal’s open platform, the business can accept crypto for payments, increase their profit margins, pay lower transaction fees, get near instant access to proceeds, and grow funds stored as PYUSD at 4% when held on PayPal,” added Chriss.
PayPal’s unified approach
On July 24, PayPal launched PayPal World, a new platform designed to streamline global payments by integrating several of the most popular digital wallets, including Venmo, Mercado Pago, Unified Payments Interface (UPI), Tenpay Global.
Alongside Pay with Crypto, PayPal is tackling longstanding cross-border payment challenges through a unified, interoperable approach which prioritises flexibility and choice for consumers and merchants.
“Last week, we launched PayPal World, our global partnership bringing together five of the world’s largest digital wallets on a single platform, fundamentally reimagining how money moves around the world. By enabling seamless cross-border crypto payments, we’re breaking long-standing barriers in global commerce,” Chriss added.
“These innovations don’t just simplify payments, they drive merchant growth, expand consumer choice, and reduce costs. This is the future of inclusive, borderless commerce, and we’re proud to lead it.”
