Here's Why PayPal Is Not Supporting Fourth-Largest Crypto Asset XRP

Here’s Why PayPal Is Not Supporting Fourth-Largest Crypto Asset XRP

14 November 2020

in XRP

Reading Time: 3 mins read

Crypto enthusiasts wondering why PayPal has skipped over the fourth-largest cryptocurrency by market cap, XRP, are getting some answers.

PayPal has partnered with the crypto exchange and stablecoin issuer Paxos Trust Company to allow its millions of users in the US to buy, sell and store Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH) and Litecoin (LTC).

In a new interview on the Unchained Podcast, Paxos CEO and co-founder Charles Cascarilla says the two companies are, in part, looking to the Securities and Exchange Commission (SEC) to determine which assets to support.

“That’s what [PayPal was] looking for and that’s what we had. We actually have authority to be able to custody and trade additional tokens. We have Pax Gold, which is one of our tokens. We have Pax dollars. So there are other products that we have that weren’t included in the crypto brokers launch. But in terms of pure cryptocurrencies, those are the four that we have that we’re listing on our exchange and really providing custody for.

We’re going to expand those as our customers need more products, but ultimately we want to be customer-driven. There’s a lot of questions as you start to get outside of those four or maybe a handful of others about whether they’re securities or not. And I think that’s always something that maybe creates a little bit of hesitation.

For instance, Bitcoin, Bitcoin Cash as a result, Litecoin, which are very similar, and Ethereum have essentially been grandfathered in by the SEC, Bitcoin explicitly and Ethereum explicitly. And once you start getting away from these top four, there are always a little bit of questions around them. Not just for us, but for the industry in general. So that’s something we need to be sensitive about.”

In addition to the four assets offered by PayPal, the New York State Department of Financial Services (NYDFS), where Paxos is headquartered, has approved four other crypto assets for trading as well.

The eight assets officially approved for trading are Bitcoin, Bitcoin Cash, Ethereum, Litecoin, Binance USD (BUSD), Gemini Dollar (GUSD), Pax Gold (PAXG) and Paxos Standard (PAX).

Although the NYDFS does allow companies to custody XRP, the asset has not yet been cleared for sale and trade. Until that happens, it appears unlikely that XRP will be offered through PayPal anytime soon.