Cryptocurrencies such as Bitcoin, Ethereum and Litecoin are digital assets that have value and exist on blockchain technology, protected by cryptography. You can use crypto wallets to send cryptocurrencies to people all over the world.
PayPal is a payment service that allows you to send fiat currencies such as US dollars and euros around the world without a paper check.
Crypto is decentralized PayPal centralized
Crypto is a decentralized platform without a single or central control system.
Decentralization means that no one can freeze your assets or restrict your trade.
PayPal, on the other hand, involves a centralized infrastructure that is under the control of its parent company. He also has a leg to lean on during financial crises as he has government support.
Crypto is semi-anonymous, PayPal it is not
Crypto is generally anonymous since it is a decentralized payment system. Crypto allows users to exchange money without revealing their true identity.
On the contrary, PayPal fully allows 100% responsibility during transactions. Both parties can see the identity of the person you’re sending money to.
Crypto transaction fees are variable
The ability to send money from anywhere in the world is a big problem. But it’s not cheap.
Crypto and PayPal make digital transactions possible and have to make money to stay in business. This is why they charge a percentage fee on all transactions.
But PayPal’s transaction fee is higher than cryptocurrencies. One of the reasons is that PayPal is a centralized payment processor.
For example, you can pay up to a 5% transaction fee for an international transfer to PayPal. A similar transaction on Ethereum would cost around $0.79. Alternatively, some cryptocurrency users can even transfer money for free with digital currencies like Nano. There are many cheap cryptocurrencies including Solana, Avalanche, Cardano and more.
So, if you’re looking for the best deals when it comes to transaction fees, you should definitely consider cryptocurrencies on PayPal.
Crypto and PayPal use different security systems
A cryptocurrency is a digital or virtual currency protected by cryptography, an advanced type of cryptography. Similarly, crypto wallets support paper wallets, the most secure type of crypto wallet. In addition to hardware wallets like Trezor or Ledger make the thought of hacking a crypto wallet hopeless.
Like Crypto, PayPal is a highly secure financial service with end-to-end encryption technology. You can also enable personal protection with passwords or two-factor authentication to avoid common scams.
The important distinction is that PayPal is a company, so you trust them with confidence. In crypto you are responsible for your own security.
Cryptographic transactions are unrecoverable
Did you send $2000 worth of Litecoin to my wallet by mistake?
Oh, did you choose Bitcoin Cash instead of Bitcoin?
I’m sorry, you can never get it back, even if I want to refund the money. With Crypto, you can’t reverse a transaction once it’s on the blockchain.
This is usually a common technical error among beginners. If you’re careful enough, you’ll never find yourself in such a red moment.
However, PayPal transactions are recoverable if the recipient chooses to collaborate.
If you were to send money to the wrong wallet, PayPal will contact the recipient on your behalf to process a refund.
PayPal limits some countries
Both Crypto and PayPal support cross-border transactions, but PayPal is not available in some countries.
Experts suggest that issues such as insufficient regulations, insecure banking systems, U.S. tax laws, and trade bans are possible reasons why PayPal does not support these countries. Crypto is available in all regions.
PayPal is more user-friendly
There is no learning curve with PayPal. PayPal’s web and mobile interface has on-screen instructions and an intuitive design helps newbies create an account and transact in no time.
Although crypto sites like Exodus offer a beginner-friendly user experience, they are one in a million. Strictly speaking, some crypto wallets like Mycelium are reserved for experts.
You can use PayPal to buy cryptocurrencies
One underrated aspect of PayPal that might be of interest to cryptocurrency purists is that you can actually use PayPal to buy cryptocurrencies with fiat (government) money.
Just be aware that there are a number of pros and cons to using PayPal for crypto transactions.
Conclusion: Different tools for different purposes
Here is the difference between Crypto and PayPal.
Financial technology changes every day and no one really knows what the future holds. But there are some real advantages to using encryption over traditional payment processors like PayPal. Keep in mind that encryption isn’t as user-friendly as something like PayPal.