Yesterday, Coinbase officially announced that it has enabled the possibility of using PayPal to pay for cryptocurrency purchases.
In reality, it had already been possible to connect a PayPal account to Coinbase for a long time, but it could only be used to withdraw fiat currency from the exchange.
However, since PayPal itself started offering the service of buying and selling cryptocurrencies directly within its platform in November last year, it became clear that sooner or later it would also agree to use the funds in its accounts to buy cryptocurrencies from third-party exchanges.
Yesterday’s announcement by Coinbase is therefore not at all unexpected, and it is possible that literally millions of people will be interested in it.
In fact, PayPal account holders who wanted to buy cryptocurrencies have long been looking for an easy and secure way to do so, and the connection with Coinbase has always seemed the most obvious one.
How does PayPal linked to Coinbase work?
Coinbase said the new service for buying cryptocurrency using PayPal-linked debit cards and bank accounts is only active in the US for now, but will be extended to other countries in the coming months. Withdrawals to PayPal accounts, on the other hand, are already available in Canada, the EU and the UK, in addition to the US.
Financing cryptocurrency purchases on the exchange with PayPal is instantaneous and just a few clicks away. All it takes is linking a PayPal account to a Coinbase account to use the bank accounts or cards previously linked to the PayPal account, as well as funds held directly in the PayPal account.
If the email address of the PayPal account that you want to use is the same as the email address of your Coinbase account, the connection is immediate, otherwise you need to go through a two-factor authentication process.
With this payment method, up to a maximum of $25,000 per day can be purchased on Coinbase.
What wasn’t specified in yesterday’s announcement is whether this new payment method will incur any additional costs on top of those charged by the exchange on purchases made with other payment methods, but in general any fees on PayPal payments are never charged to the person making the payment.