PayPal allows users to withdraw Bitcoin to external wallets

[franky1]

It looks like Paypal decided to change their strategy from trying to corner the market by trying to suck in as much Bitcoin as possible to their closed ecosystem, by using their huge existing user base.

there is more to it then that..
there is what i call the 'stirring the pot' problem

if funds are locked into a system with no desire/ability to exit those coins. then people just end up swapping within the system. this means no buying new coin(at corporate paypal level) no exiting with the coin(at customer level). and so its just the same coin stirring in the pot.. being held in custody but not blockchain moving. and instead just changing users account balance numbers. where users are upset by having to sell at a loss when the only option to exit paypal was $$

where as letting people exit holding btc and allowing new users to buy and exit. means new buyers are then requesting coins, which paypal doesnt have to give(less in custody). so paypal buys more to then give.
which at this precise moment is good because its cheap to buy them.

new coins get to stir in the custodial pot at a new lower average cost..

EG instead of stirring the pot of coins where they initially may have been bought at $60k by paypal corporate, and lots of users were at a 50% loss when selling yesterday within paypal(as their only way out previously). those users can exit holding their coin and be happier to be non custodial holders. and not forced to sell at a loss
whereby fresh customers can buy fresh coins. at lower prices. and paypal is then able to 'average down' its custody value of coins it has and keep customers happy

[Yogee]

Although that this is truly a welcoming development for all of us who are into crypto (especially Paypal users who are storing BTC and other cryptos), the fees are the big question here. I am not sure how much fees will be deducted in BTC for external wallet withdrawals. There's no final fee structure yet as of now, but later on they would finally reveal it.

What it says on their released statement provided by dmrdmr,

PayPal will provide an estimate of your network fees on the confirmation screen.

I'm guessing they will allow you to customize the fee to a certain extent like giving you the option to choose from lowest to highest priority. The problem there is that their estimate will be higher than what you see on mempool.space

[franky1]

I'm guessing they will allow you to customize the fee to a certain extent like giving you the option to choose from lowest to highest priority. The problem there is that their estimate will be higher than what you see on mempool.space

custodial services usually dont send transactions out one by one where the user pays the whole fee of one transaction.

they usually batch it up as being like a 1in100out
which works out cheaper then a 1in 2out

EG

bc1qexchangecoldwallet (5000btc) -> bc1qcustomer1wallet (0.99999860btc)
                                                       bc1qexchangecoldwallet (4999btc)
(140 vbyte) (customer pays 140sat fee at 1sat per vbyte)
vs
bc1qexchangecoldwallet (5000btc) -> bc1qcustomer1wallet (0.99999968btc)
                                                       bc1qcustomer2wallet (0.99999968btc)
                                                       ....
                                                       bc1qcustomer99wallet (0.9999968btc)
                                                       bc1qexchangecoldwallet (4901btc)
(3179 vbyte)(customer pays 32sat fee each at 1 sat per vbyte)

[sheenshane]

At least they heard of what their customers demand.

But in exchange for this action, as I read in the article Paypal was planning to increase their identity verification process for users before they can send out their Bitcoin or other altcoins completely outside the Paypal's wallet.  So what it is?

However, it turns out better than before because you are now able to transfer your fund to an external wallet.  I think this system will be going to adopt them is the same as other custodial wallets locally.  The same in our local wallet, there's no fee when you send from the same wallet and if it's external transaction will vary only on the network fee and which is sounds great.

[Darker45]

At least they heard of what their customers demand.

Indeed. I guess that's the most important point here. It's been more than a year since PayPal allowed its users to buy Bitcoin, Ethereum, and Litecoin. It's only now that they finally allow them to really own their cryptocurrencies. So the issue on fees is a different one. For now, the issue on withdrawal is addressed.

But in exchange for this action, as I read in the article Paypal was planning to increase their identity verification process for users before they can send out their Bitcoin or other altcoins completely outside the Paypal's wallet.  So what it is?

What's the big deal? This isn't a catch anymore. It is PayPal, after all. What do you expect? Your identity is already there. Not only that, your bank information is also there already. So what else is there to hide? Apparently, this PayPal thing is only for a specific kind of people, though.

[yazher]

Changes such as this one will bring positive views for bitcoins, it came from trusted sources therefore critics have no room to criticize them. This is now convenient for the people who wanted to keep their BTC with them in their personal wallet for security reasons and they don't have to worry about transaction fees using any 3rd parties to get their cryptocurrencies. As for the other payment apps, they should make it possible to have this kind of feature so that they won't be left behind and lose some users.

[cryptoaddictchie]

But in exchange for this action, as I read in the article Paypal was planning to increase their identity verification process for users before they can send out their Bitcoin or other altcoins completely outside the Paypal's wallet.  So what it is?

Its gonna mixed up of users. Some will agree to this and those who preserved their privacy will surely end up not using paypal at all. Anyway, there are much other ways other than paypal to do buy and sell of bitcoin.

But its great to see that PayPal are now in the league with others relating to bitcoin. It just show that bitcoin adoption is slowly but surely.

[pooya87]

So after almost 2 years (from October 2020) of letting people deposit bitcoin and trade it on their platform, they have accumulated enough bitcoin from their customers to feel safe to let people withdraw some of it (considering not everyone would withdraw)!
Basically they sold and held fake bitcoin for a long time.

[ChiBitCTy]

This was a long time coming, sure took long enough. Despite this positive new coming out of PayPal, it’s some of the only good news you’ll ever hear from this company. I would still highly suggest people buy their crypto elsewhere, and not support such a corrupt company. Buy OTC or on exchange like Kraken.

[cabron]

So after almost 2 years (from October 2020) of letting people deposit bitcoin and trade it on their platform, they have accumulated enough bitcoin from their customers to feel safe to let people withdraw some of it (considering not everyone would withdraw)!
Basically they sold and held fake bitcoin for a long time.

That's what it appears to be. When the price dropped below $30K, probably used the funds to buy to be distributed to whoever wants to get  out of paypal. Anyone may also have that hunch. 2 years ago, the price was less than $20K, that's a lot of money that could triple BTC holdings.

Allowing users to have their coins in custody I think earns then the trust at least for the paypal users. Maybe those who refuse to used paypal may start using it again. If Paypal fully become an exchange competing coinbase I wouldn't be surprise.

[Nrcewker]

As the title says, PayPal is finally allowing their users to move their Bitcoin to their own wallets. PayPal went a long way, from getting people banned for buying Bitcoin using PayPal ( I know few people that lost their PayPal accounts due that) to now this. I am just curious how many PayPal users will actually go for that option and start taking responsibility for their own money. Somehow I doubt that number will be huge, bits its a good thing to have that option and is a step in the right direction.

Starting today, PayPal supports the native transfer of cryptocurrencies between PayPal and other wallets and exchanges," said the financial giant in a statement. The ability to conduct external transfers on PayPal's crypto platform, an image of which can be seen below, will start rolling out to users today and be available to everyone in the U.S. in the next week or two.

It's only available in the U.S. right ?
Paypal still needs to think about the people from other countries as well.
I might be wrong, but yes Paypal isn't allowing other countries for this, as Bitcoins aren't legal in other countries.
But what about the countries like El Salvador? Aren't the people of that country be allowed to buy,sell,transfer Bitcoins in paypal ?
At least what they can do is stop banning Paypal account of the users or set some sort of warning limits for the ones who buys or trade Bitcoins in Paypal.
Willing to hear other people's thought on this manner.

[pooya87]

If Paypal fully become an exchange competing coinbase I wouldn't be surprise.

I don't think it is going to happen. Coinbase has been around much longer and is more trusted than the shady PayPal that has a history of being against bitcoin, not to mention that it offers more options compared to PayPal. In fact PP is best for those who have an account with them already with funds that they want to dump for bitcoin.

[lovesmayfamilis]

It's only available in the U.S. right ?
Paypal still needs to think about the people from other countries as well.
I might be wrong, but yes Paypal isn't allowing other countries for this, as Bitcoins aren't legal in other countries.
But what about the countries like El Salvador? Aren't the people of that country be allowed to buy,sell,transfer Bitcoins in paypal ?
At least what they can do is stop banning Paypal account of the users or set some sort of warning limits for the ones who buys or trade Bitcoins in Paypal.
Willing to hear other people's thought on this manner.

That is why I will not use this payment system. I don't live in the USA, but even if all the privileges are available to residents from other countries, PayPal will be the last one I trust with my bitcoins. I once got burned by the fact that, for no reason, my account was blocked. Therefore, whatever they do, I will constantly feel "guilty", since the complete identification and expectation of any surprises I remember well from my previous communication with this company.

[NeuroticFish]

If Paypal fully become an exchange competing coinbase I wouldn't be surprise.

I don't think it is going to happen.

It cannot happen simply because PayPal fees may be much higher than any of the competition's.
And, as said, they were selling IOUs called Bitcoin for so long. So I expect they may try to find ways to not have to work much with actual bitcoin (hence put a discouragingly big enough withdrawal fee).
PayPal has its own role in trades: it's a pretty well known and reputed escrow. Bitcoin is just another currency they'll be escrowing, they have no good reason to compete with Bitcoin Exchanges.

[goldkingcoiner]

As the title says, PayPal is finally allowing their users to move their Bitcoin to their own wallets. PayPal went a long way, from getting people banned for buying Bitcoin using PayPal ( I know few people that lost their PayPal accounts due that) to now this. I am just curious how many PayPal users will actually go for that option and start taking responsibility for their own money. Somehow I doubt that number will be huge, bits its a good thing to have that option and is a step in the right direction.

Starting today, PayPal supports the native transfer of cryptocurrencies between PayPal and other wallets and exchanges," said the financial giant in a statement. The ability to conduct external transfers on PayPal's crypto platform, an image of which can be seen below, will start rolling out to users today and be available to everyone in the U.S. in the next week or two.

Paypal needs to die out.

It's completely redundant and pointless. Between non-existent customer service and arbitrary bans, it basically borders on between being a scam and being a useless fiat service. I really cannot put into words how much I want Paypal to burn.

Although that they finally decided to give back people a sliver of their own freedom back, so they can buy Bitcoin, is very good news.

The least they can do is unban the people who were unjustly banned. But I'm guessing that's impossible just because of the sheer amount.

[PrivacyG]

So after almost 2 years (from October 2020) of letting people deposit bitcoin and trade it on their platform, they have accumulated enough bitcoin from their customers to feel safe to let people withdraw some of it (considering not everyone would withdraw)!
Basically they sold and held fake bitcoin for a long time.

I suspect this is the case.  They let you deposit Bitcoin to their account and they gave you a number for it.  Now that with the bear market a lot of people sold even on a loss, what PayPal did was set the number of their account to zero, keep the Bitcoin and give them back Fiat.  With this kind of strategy, they can accumulate Bitcoin without paying anything for it really.  It is the users who gave them the Bitcoin.  Had they wanted to allow deposits, they would have done it straight from the start.

But it is easy to fool people like this when the education level about Bitcoin is very low to inexistent for the average person and it is even rarer for someone to know why custodial is a mistake.  They are basically making money off customers they can fool into believing they are truly holding Bitcoin.

-
Regards,
PrivacyG

[bakasabo]

It's only available in the U.S. right ?
Paypal still needs to think about the people from other countries as well.
I might be wrong, but yes Paypal isn't allowing other countries for this, as Bitcoins aren't legal in other countries.
But what about the countries like El Salvador? Aren't the people of that country be allowed to buy,sell,transfer Bitcoins in paypal ?
At least what they can do is stop banning Paypal account of the users or set some sort of warning limits for the ones who buys or trade Bitcoins in Paypal.
Willing to hear other people's thought on this manner.

Right, this is for US only. I live in Europe and I dont an option to withdraw Bitcoin on PayPal, as well as buy or trade it there, or add Bitcoin as currency I wish to make action with. I wont say that here PayPal is as popular as in US, people still prefer to make payment by cards, but still a lot of people use PayPal. PayPal already tried to become more popular in Europe, as they charge zero fees for PayPal > bank transactions in some countries. Adding Bitcoin for Europe users might be a solution to increase popularity, but they dont rush to do it.

[ForMeritt]

It's possible that a Paypal wallet can be an option to move Bitcoin to a paypal wallet, and it seems that this will be the discussion and discussion about the issue of Fees, I myself don't know for sure about the Fees, maybe in the near future this Fee problem will be solved.

[LoyceMobile]

So after almost 2 years (from October 2020) of letting people deposit bitcoin and trade it on their platform, they have accumulated enough bitcoin from their customers to feel safe to let people withdraw some of it (considering not everyone would withdraw)!

That will depend on their withdrawal fees, many exchanges use high fees to deter people from withdrawing, and many people don't even care about having their own wallet.

Paypal needs to die out.

It's completely redundant and pointless.

Paypal used to be the standard on eBay and Chinese webshops. Those days are gone already, the large webshops (think Amazon and Aliexpress) use cheaper and more reliable creditcard payments. I can't believe both of them have my card details on file, and I'd love to see them accept Bitcoin LN instead, but I don't expect it as long as the majority of their customers doesn't use it.

[Lucius]

As the title says, PayPal is finally allowing their users to move their Bitcoin to their own wallets. PayPal went a long way, from getting people banned for buying Bitcoin using PayPal ( I know few people that lost their PayPal accounts due that) to now this.

I don't believe that PP officials have a different view of Bitcoin than they did when they banned people for crypto/PP transactions, but that it's just a matter of profit and they will take the opportunity. I would also not be surprised if in the future they change their minds again and thus close the circle.

I am just curious how many PayPal users will actually go for that option and start taking responsibility for their own money. Somehow I doubt that number will be huge, bits its a good thing to have that option and is a step in the right direction.

I think most will continue to keep their BTC the way they have done so far, because if PP was their crypto bank, they will not see this option as an advantage. Still, maybe this opportunity will attract some new customers who know the benefits of controlling their private keys. If they were to pull off a smart business move, then they should lower the service fee so that they are competitive with those who still charge dearly for it.