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PayPal to allow UK users to buy, hold and sell cryptocurrencies

By Iain Gilbert

Date: Wednesday 27 Oct 2021

(Sharecast News) - Online payments giant PayPal has revealed that it will allow UK users to buy, hold and sell cryptocurrencies using its platform.
PayPal stated that users of both its app and website in Britain will initially be limited to Bitcoin, Ethereum, Litecoin and Bitcoin Cash in a move that comes after the company launched the same service in the US - which was then followed by a "Checkout with Crypto" feature, enabling users to make purchases with online merchants using cryptocurrencies.

PayPal said the new service will be available later in the week, with all eligible customers given access to it through a new cryptocurrency tab over the coming weeks. However, PayPal did not make it immediately clear if and when it would allow UK consumers to pay merchants with cryptocurrency.

AJ Bell's head of investment analysis Laith Khalaf said: "It's certainly an area the FCA is taken a keen interest in, thanks to the rising popularity of crypto trading, and the potential for high levels of consumer harm from volatile prices. PayPal has doffed its cap to regulatory concerns, highlighting the educational content it will host alongside its crypto service, including the risks.

"That's to be welcomed, though there are already concerning signs of reckless behaviour by consumers. An alarming statistic is that 14% of UK crypto buyers funded their purchases using debt, according to figures released by the FCA in June. While many are no doubt using crypto as a bit of harmless fun with small amounts of money they can afford to lose, some consumers are at risk of getting sucked in and spat out by the crypto craze. Within the crypto market itself, PayPal's presence is positive in that it is a high profile, publicly listed company which is already subject to regulatory scrutiny. But overall the crypto craze remains a worry for consumer advocates and regulators, as well as inveterate luddites."

As of 1330 BST, PayPal shares were up 0.82% in pre-market trading at $275.20 each.

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