The Payments Giant That's Quietly Winning the Crypto War

Key Points

• Fintechs like PayPal have made huge strides towards increased crypto adoption.

• PayPal has a lot to offer cryptocurrency investors.

• 10 stocks we like better than PayPal ›

The lines between traditional banks, fintechs, and cryptocurrency companies are becoming increasingly blurred. New stablecoin legislation will allow crypto companies to offer bank-like services. Meanwhile, banks and payment providers are racing to integrate cryptocurrencies and blockchain technology into their day-to-day businesses.

PayPal (NASDAQ: PYPL) is ahead of the game. It launched cryptocurrency services back in 2020. Since then, it has steadily integrated crypto and blockchain into its operations.

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PayPal's crypto credentials

According to its site, PayPal has over 430 million active customer and merchant accounts. Combine that with its stablecoin and crypto operations, and you have a pretty potent combination, one that gives the payment giant a big advantage.

Here are a few of the strides PayPal has already taken in the crypto world:

• October 2020: PayPal launches cryptocurrency services. Users can buy, sell, and hold Bitcoin, Ethereum, Bitcoin Cash, and Litecoin. Venmo follows suit in April 2021.
• March 2021: PayPal introduces Checkout with Crypto. Customers can choose to pay with crypto with certain merchants.
• August 2023: PayPal launches its own PayPal USD (CRYPTO: PYUSD) stablecoin.
• July 2025: PayPal World is launched, a platform that connects digital wallets and promises seamless money transfers and international payments.

PayPal has a lot to offer

Price-wise, cryptocurrency prices -- particularly Bitcoin -- have surged this year. Pure-play crypto companies like Coinbase are outperforming PayPal by some margin. As of this writing (Sept. 16), PayPal is down over 20% year to date. Coinbase is up over 30% and Bitcoin is up 25%.

Fintech companies like PayPal face serious headwinds in the form of fierce competition, regulatory challenges, and wider economic uncertainty. Meanwhile, cryptocurrencies are riding a wave of optimism, spurred by changing attitudes in Washington.

But at some point, those crypto projects will need to deliver. And it's at that point that PayPal's huge network, user base, and infrastructure may well win out.

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Emma Newbery has positions in Ethereum. The Motley Fool has positions in and recommends Bitcoin, Ethereum, and PayPal. The Motley Fool recommends Coinbase Global and recommends the following options: long January 2027 $42.50 calls on PayPal and short September 2025 $77.50 calls on PayPal. The Motley Fool has a disclosure policy.