PayPal to allow users to withdraw cryptocurrencies to third-party wallets

On Wednesday, PayPal’s head of blockchain and crypto, Jose Fernandez da Ponte, said at the Coindesk Consensus conference that the company will add support for third-party wallet transfers, which means that PayPal and Venmo users can not only send Bitcoin to users within the platform, but also withdraw it to platforms such as Coinbase and external cryptocurrency wallets.

“We want to make it as open as possible and want to give our consumers the choice to pay however they want to pay,” Ponte said. “They want to bring their cryptocurrencies to our platform to use for commerce, and we want them to be able to do that.”

Fernandez da Ponte declined to provide further details, such as when PayPal will launch the new service or how it will handle blockchain transactions created when users send and receive crypto. The company releases new developments on average every two months, and it is unclear when the withdrawal feature will be released.

There are rumors that PayPal plans to launch its own stablecoin, but Ponte said “it’s too early to tell.”

“It makes absolute sense for central banks to issue their own tokens,” he said, but he rejected the common view that only one of these, stablecoins or CBDCs, would dominate.

Ponte believes that central bankers have two priorities: financial stability and universal access. There are many ways to achieve digital currency stability, not only by backing stablecoins with fiat currencies, but also by backing stablecoins with CBDCs.

He said digital currencies could help expand access to the financial system.

In Ponte’s view, digital currencies are not yet ready to offer people around the world a drastically lower cost of payments.

PayPal opened some cryptocurrency transactions to U.S. customers in November and began allowing users to use cryptocurrencies to purchase goods and services in March.

The company reported better-than-expected first-quarter results, with adjusted earnings of $1.22 billion, beating analysts’ average estimate of $1.01 billion. The company said customers who bought cryptocurrencies through the platform logged into PayPal twice as often as before they bought cryptocurrencies.