Payments giant PayPal held hundreds of millions of dollars in cryptocurrencies in the fourth quarter of 2022, according to its annual financial report to the US Securities and Exchange Commission (SEC). The report showed that PayPal held approximately $604 million in cryptocurrencies, including $291 million in Bitcoin (BTC) and $250 million in Ethereum (ETH), with $63 million in other undisclosed digital assets.
PayPal Enters the Crypto Market
In 2020, PayPal made a move into the cryptocurrency market by enabling its customers to purchase and hold various cryptocurrencies through its platform. As a result, it has become a significant player in the crypto market. In December of 2022, PayPal announced a partnership with blockchain company ConsenSys to integrate PayPal into MetaMask, one of the world’s most popular crypto wallets.
Partnership with MetaMask
The product manager of MetaMask, Lorenzo Santos, said at the time that the collaboration between the two companies would enable MetaMask users to easily buy and sell crypto and communicate with Web 3 applications such as non-fungible token (NFT) marketplaces, decentralized finance (DeFi) platforms, and blockchain-based games.
PayPal Pauses Stablecoin Project
PayPal was reportedly working on its own stablecoin, but according to Bloomberg, that project has been put on hold. This news came shortly after it was announced that PayPal’s crypto partner, Paxos, was being investigated by the New York Department of Financial Services (NYDFS).
Paxos Under Investigation
Paxos is a US-based company that issues stablecoins, including the Pax dollar and Binance USD (BUSD). Paxos manages the issuance of Binance’s stablecoin with BUSD. However, the NYDFS is investigating Paxos, which may have implications for the company and the Binance USD, as US regulators are generally not happy with the way Binance operates, due to its relatively opaque structure.
PayPal’s Response
PayPal responded to Bloomberg through its spokesperson Amanda Miller, who said in an email to the news platform that the project is currently on hold. “If and when we decide to move forward with this, we will of course work closely with regulators,” Miller said.