The Venmo mobile payment service allows its customers to purchase cryptocurrencies from today.
According to the company, it opens the possibility of buying, storing and selling cryptocurrencies for its base of more than 70 million users directly in the app. Similarly, PayPal, the parent company of Venmo, implemented cryptocurrency support at the end of last year. Initially, Venmo will support four assets: Bitcoin, Ethereum, Litecoin and Bitcoin Cash. They are also available to American PayPal users.
Along with last year's announcement, PayPal announced plans to add a similar service to Venmo. In both cases, access to digital assets is realized through cooperation with the Paxos Trust Company. While the trading services are similar in nature, the company notes that Venmo will open up digital assets to a separate and presumably younger audience.
"Although there is some overlap, there are many customers who use either PayPal or Venmo," said Venmo General Manager Darrell Ash. – Ultimately, this gives us a new group of customers who don't use PayPal on a day-to-day basis and will be able to access cryptocurrencies through Venmo."
Ash expects that the decision to add cryptocurrencies to Venmo will be particularly successful due to the customer profile. In most cases, these are people over the age of 20, with a higher education and a middle-level income, who are inclined to digital innovation.
Users have already started buying cryptocurrencies, according to Venmo. According to a survey conducted in 2020, more than 30% of customers invested in stocks or cryptocurrencies. Activity has increased amid the coronavirus pandemic.
During the launch phase, Venmo will use social network-level interactions, allowing users to publicly share messages about the purchase of cryptocurrencies. This is expected to help raise awareness and attract new investors. PayPal recently added the ability to pay for goods and services with digital assets. There is no such option in Venmo yet.
According to some estimates, the addition of cryptocurrencies to PayPal has significantly affected the presence of retail investors in the market during the current cycle.