Fintech giant PayPal delivered better-than-expected fourth-quarter results with the help of Bitcoin integration. Noting that fiscal 2020 was its strongest year ever. This was boosted by record-setting payment volume and new account additions.
Many users hopped over to the San Jose, California-based company after it entered the crypto market this past October. PayPal secured a conditional license from the New York State Department of Financial Services (NYDFS). Which allows U.S. residents of its Venmo service to buy, hold and sell cryptocurrencies.
During a conference call with investors, PayPal CEO Dan Schulman explained the company has designed an extensive product roadmap around crypto, blockchain and digital currencies.
“We are significantly investing in our new crypto, blockchain and digital currencies business unit,” he said. “Also seeing an exceptional response from our crypto launch. Even with high initial expectations the volume of crypto traded on our platform greatly exceeded our projections”.
“We are excited to build upon this early success by allowing customers to use their crypto balance as a funding source. Whenever they shop at our 29 million merchants. We anticipate the rollout of that capability to begin late this quarter. Hoping to launch our first international market in the next several months. These initial steps are just the beginning of an extensive road map around crypto, blockchain and digital currencies.”
Shuman also revealed that users of Bitcoin and other supported cryptocurrencies (Bitcoin Cash (BCH), Ethereum (ETH), and Litecoin (LTC) opened the PayPal app at twice the rate of others.
“What Paypal has done is trigger a domino effect. Other digital and mobile payments companies will have to follow suit or be left behind”. Trader and economist Alex Kruger said.
PayPal reported net income of $1.5 billion (1.32 per share) in Q4. Non-GAAP earnings were $1.08 per share on revenue of $6.12 billion, up 23% year over year. Wall Street was expecting fourth quarter earnings of $1.00 per share on revenue of $6.09 billion.
PayPal also reported ending Q4 with 377 million active accounts — a 24% increase. The quarter saw an additional 16 million active accounts along with 1.4 million merchants, up 137% from Q4-19.
PayPal is now working on introducing tools to their 29 million merchants worldwide so that they can start accepting crypto as payment. “These initial steps are just the beginning of an extensive road map around crypto, blockchain, and digital currencies,” Schulman said.
In November, PayPal announced plans to integrate Bitcoin into Venmo as well, which they now revealed will be expanding in select international markets during the first half of 2021.
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