PayPal Cuts International Transaction Fees by 90% with New Crypto Payment Service for U.S. Merchants

PayPal has introduced a new crypto payment solution for U.S. merchants, enabling near-instant settlements with over 100 cryptocurrencies. The service, named Pay with Crypto, allows businesses to accept digital assets such as Bitcoin, Ethereum, USDT, XRP, Solana, and novelty tokens like Trump memecoin and Fartcoin. Transactions are processed by converting crypto into PayPal’s stablecoin, PYUSD, and then into U.S. dollars within seconds, with funds immediately available to merchants. The system leverages on-chain transparency and integrates with popular wallets like Coinbase Wallet, MetaMask, OKX, Kraken, and Phantom [1].

The platform aims to cut international transaction fees by up to 90% compared to traditional methods, according to PayPal’s internal analysis. A promotional fee of 0.99% is available through July 31, 2026, after which the rate will rise but remain competitive. For context, the average international credit card transaction costs U.S. businesses approximately 1.57%, including foreign exchange fees, as reported by the 2024 Nilson Report [2]. PayPal CEO Alex Chriss highlighted the service’s potential to simplify global commerce by reducing costs and streamlining cross-border transactions. He cited a hypothetical scenario where a Guatemalan shopper could purchase a gift from an Oklahoma-based merchant, underscoring PayPal’s vision for borderless commerce [1].

The rollout aligns with PayPal’s broader strategy to expand its digital asset ecosystem. The company’s PYUSD stablecoin, launched in 2023, is backed by U.S. Treasury assets and dollar reserves, maintaining a 1:1 peg with the dollar. Merchants holding PYUSD can earn up to 4% annual rewards, incentivizing adoption. Additionally, a partnership with Fiserv aims to enhance stablecoin utility in cross-border and B2B payments [1]. The Pay with Crypto initiative follows the launch of PayPal World, a cross-border payments project integrating local systems like India’s UPI and Latin America’s Mercado Pago. This expansion targets 2 billion users by connecting global wallets through PayPal and Venmo [1].

The move positions PayPal as a leader in bridging traditional finance with crypto, addressing pain points like high international fees and complex integration. By offering instant settlement and lower costs, the service could attract small businesses seeking to tap into the 650 million global crypto users, as noted by a 2025 market sizing report from Crypto.com [1]. However, the success of the platform will depend on user adoption, regulatory clarity, and competition from other payment processors exploring blockchain solutions.

Source: [1] [PayPal Launches Crypto Payments for US Merchants with Near-Instant Settlement] [https://thecryptobasic.com/2025/07/28/paypal-launches-crypto-payments-for-us-merchants-with-near-instant-settlement/?utm_source=rss&utm_medium=rss&utm_campaign=paypal-launches-crypto-payments-for-us-merchants-with-near-instant-settlement] [2] [2024 Nilson Report] [https://www.nilsonreport.com/2024/nilson-report.html]