PayPal Crypto Service Cuts Cross-Border Fees by 90% in First Year

PayPal Holdings, Inc. is set to launch a new service allowing U.S. merchants to accept over 100 cryptocurrencies as payment, including Bitcoin (BTC), Ethereum (ETH), and major stablecoins like USDT and USDC. The feature, titled “Pay with Crypto,” will enable shoppers to transact using wallets such as MetaMask, Coinbase, and Binance. By converting incoming crypto payments into U.S. dollars via PayPal’s stablecoin PYUSD, merchants can avoid price volatility while receiving funds in their accounts within seconds [1]. The initiative, scheduled to roll out in the coming weeks, aims to reduce transaction costs and streamline global commerce for small businesses [2].

The move addresses challenges faced by merchants in cross-border transactions, where traditional credit card processing fees often exceed 3%. PayPal’s crypto service promises to cut these costs by up to 90% in the first year, with a 0.99% fee rate (rising to 1.5% post-July 31, 2026). This reduction stems from bypassing intermediaries, which typically impose additional currency conversion and processing charges [3]. CEO Alex Chriss highlighted the initiative as a solution to barriers in global expansion, stating, “We’re removing these barriers and helping every business of every size achieve their goals” [4]. The system automates crypto conversion and deposits funds into merchants’ accounts, leveraging PayPal’s stablecoin—which is backed by U.S. dollar deposits and Treasury bonds—though it remains unavailable to New York residents and lacks FDIC insurance [5].

The service supports cryptocurrencies representing approximately 90% of the global crypto market cap, catering to diverse consumer preferences. PayPal’s approach aligns with broader fintech trends, including partnerships like Shopify’s collaboration with Coinbase and Stripe’s acquisition of a stablecoin firm [6]. Regulatory clarity has also bolstered confidence, as the SEC recently closed its investigation into PYUSD without action. The company’s “PayPal World” strategy further positions crypto as a tool for global commerce, integrating services with systems like India’s UPI and Latin America’s Mercado Pago [7].

For small businesses, the service democratizes access to crypto payments without requiring technical expertise. By handling compliance and volatility risks, PayPal lowers adoption barriers. However, success hinges on user adoption, as traditional payment methods remain dominant. Cost savings and regulatory certainty may drive early adoption, particularly among cross-border merchants. The initiative reflects PayPal’s focus on modernizing payment systems and expanding access to global trade, potentially reshaping the digital asset landscape [8].

Sources:

[1] [PayPal Expands Crypto Payments for U.S. Merchants](https://www.coindesk.com/business/2025/07/28/paypay-expands-crypto-payments-for-u-s-merchants-to-cut-cross-border-fees)

[2] [PayPal Drives Crypto Payments into the Mainstream](https://www.prnewswire.com/news-releases/paypal-drives-crypto-payments-into-the-mainstream-reducing-costs-and-expanding-global-commerce-302514424.html)

[3] [PayPal Launches Crypto Payments for US Merchants](https://bravenewcoin.com/insights/paypal-launches-crypto-payments-for-us-merchants-slashing-cross-border-fees-by-up-to-90)

[4] [PayPal to Let Merchants Accept 100+ New Coins](https://mashable.com/article/paypal-pay-with-crypto-announcement)

[5] [PayPal’s New Crypto Payments for U.S. Merchants Cut](https://www.ainvest.com/news/paypal-crypto-payments-merchants-cut-cross-border-fees-90-0-99-rate-2507)

[6] [PayPal Will Let Cross-Border Merchants Pay With Crypto](https://www.pymnts.com/news/cross-border-commerce/cross-border-payments/2025/paypal-will-let-cross-border-merchants-pay-with-crypto/)

[7] [PayPal Launches Crypto Checkout Tool, Adds Support for](https://cointelegraph.com/news/paypal-crypto-checkout-tool-support-100-tokens)

[8] [PayPal to Roll Out 'Pay With Crypto' Feature for Merchants](https://www.bloomberg.com/news/articles/2025-07-28/paypal-to-roll-out-pay-with-crypto-feature-for-merchants)