Pay With Crypto Using PayPal: Here's How
by Natasha Gabrielle | Updated Jan. 13, 2022 - First published on May 3, 2021
Checkout with Crypto makes it simple and convenient to pay for an online purchase with a digital currency -- all from your PayPal account
Payment processing companies are finding new ways to appeal to the ever-growing needs of their customers. PayPal is no exception. Recently, PayPal announced that its U.S. users can now use cryptocurrencies to make payments. This new feature is named Checkout with Crypto.
This feature is available to anyone with cryptocurrency holdings in the U.S. Keep reading to learn more and to see how you can pay with crypto when using PayPal.
How Checkout with Crypto works
On March 30, 2021, PayPal introduced Checkout with Crypto. This new feature makes it quick and easy to pay for your online purchases with cryptocurrency. PayPal users will be able to use digital currency to make purchases at all 29 million merchants that accept PayPal.
When you use Checkout with Crypto, your cryptocurrency will be converted to fiat currency (national currency, such as the U.S. dollar) during the checkout process. You will then be shown the cryptocurrency conversion spread. There are no additional transaction fees charged for this service.
Here's how to use this new feature:
- Choose a store or online shop that accepts PayPal Checkout and add items to your cart as you normally would.
- If you have enough of a single type of cryptocurrency in your PayPal wallet, crypto will display as a payment option.
- If you have multiple types of crypto available, you can select from the following options: Bitcoin, Ethereum, Bitcoin Cash, or Litecoin.
- You can't mix cryptocurrencies when making a purchase. Instead, you can only select one type. In addition, you can't partially fund a payment with crypto and then use another payment method.
- After you choose which type of cryptocurrency you want to use, it will be converted to fiat currency, and the transaction will then be completed.
PayPal is already known for protecting its users, and this now includes payments using digital currency. Eligible purchases made with cryptocurrency will include PayPal's 24/7 fraud protection and return shipping and purchase protection.
Buy, sell, and hold crypto with PayPal
The Checkout with Crypto feature expands on PayPal's cryptocurrency services. Introduced in October 2020, PayPal users within the U.S. (excluding Hawaii) and U.S. territories can also buy, sell, and hold cryptocurrencies with PayPal.
To buy crypto with Paypal, you must use your PayPal Cash or Cash Plus balance or a linked debit card or bank account. You won't be able to use a credit card. This is similar to other cryptocurrency exchanges and apps.
You can hold the crypto you buy in your PayPal account, but you can't transfer your purchased crypto off the PayPal platform. Currently, the following cryptocurrencies are available:
- Bitcoin Cash
If you're new to buying and selling crypto, you can start with small purchases. You're able to safely buy Bitcoin and the other cryptocurrencies with as little as $1. Since the crypto market runs 24/7, you can buy or sell at any time of day.
Once you make a purchase, you can't reverse the charge or cancel your order. However, if unauthorized activity occurs within your account and results in the purchase of crypto, you won't be held liable.
There are zero fees for holding crypto in your PayPal account. But there are fees associated with buying and selling digital currencies within PayPal. Here's a closer look at what you will pay.
Want to trade Crypto? See The Ascent's comparison of Coinbase vs. PayPal.
|Purchase or sale amount||Fee|
|$1.00 to $24.99||$0.50 USD|
|$25.00 to $100.00||2.30%|
|$100.01 to $200.00||2.00%|
|$200.01 to $1,000.00||1.80%|
Always be cautious when it comes to cryptocurrencies
It's important to understand the risk that you're getting into when buying digital currencies. Crypto is still brand new and is not regulated in many U.S. states and territories. That's why it can be a risky investment.
To learn more about how to be smart and careful with your money, take a look at our personal finance resources.
The bottom line
In addition to buying, selling, and holding crypto within your PayPal account, you can now make purchases with your cryptocurrency. This new feature gives PayPal users more financial choices and offers more convenient ways to put their cryptocurrencies to use.
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About the Author
We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.
Natasha Gabrielle has no position in any of the stocks or cryptocurrencies mentioned. The Motley Fool owns shares of and recommends Bitcoin.