PayPal, Venmo To Enter Crypto Market

June 24, 2020 01:51 PM
PayPal Enters Crypto Market






Crypto markets are quiet but marginally lower this morning. Realized volatility metrics continue to contract as shown in the chart.

BTC USD Realized Volatility


This week, several news sources reported that Paypal/Venmo would be releasing integrations for purchases and sales of crypto within months. The episode again highlights gradual infrastructure developments addressing previously identified criticisms with crypto.

The quoted source noted, "My understanding is that they are going to allow buys and sells of crypto directly from PayPal and Venmo." The article references Bitstamp and an existing relationship with Coinbase as likely partners in the endeavor. The offering is said to also include a wallet. Paypal/Venmo have been known to be hiring in the space, starting a 'Blockchain Research Group' this year. Paypal's Chief Technology has said, "We are a strong believer in the potential of blockchain. The digitization of currency is a question of when not if." The move is about a year behind that of another well-established USD payment processor Square. Square has typically reported in the range of 100 milllion USD equivalent notional of BTC traded per quarter.

Assuming these reports are accurate we feel as though the most significant potential for this news is payment processing of crypto. While the platform appears to be first enabling buying and selling, it only seems to be a matter of time before Paypal/Venmo would move into processing online payments for merchants. This has the potential to open channels on established e-commerce venues such as Amazon and Shopify. Furthermore, an oft-heard criticism of crypto is that there are limited avenues for spending, making the currencies purely speculative. This is another reminder that the space remains just over a decade old and infrastructure development continues to solve previously labeled issues.


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FRNT Financial is a technology and sales layer that offers institutional and accredited investors access to various forms of exposure to crypto-assets. You can subscribe to FRNT Financial Morning Note at