PayPal’s crypto features will allow users to buy Bitcoin, Ethereum, Bitcoin Cash, and Litecoin directly from their PayPal account.
Like most cryptocurrency exchanges, the company will not give users direct custody over their funds or access to their private keys. This is expected, given that Paxos, a popular centralized exchange power PayPal’s service.
Other exchanges, such as Coinbase and Binance, handle funds in the same way.
However, PayPal’s limitations extend far beyond those seen on most exchanges. The company’s FAQ pages indicate that users will not be able to send cryptocurrency via PayPal or use cryptocurrency to pay for purchases. Furthermore, investors will not be able to withdraw their cryptocurrency to their own wallet, nor will they be able to deposit cryptocurrency into their accounts.
This means that, at launch, PayPal’s cryptocurrency service will only be useful for speculative investors—that is, investors who want to buy cryptocurrency and then sell it at a later date.
The FAQ page implies that the company may introduce some of its absent features in the future, though that is far from definite.