TLDR
- PayPal launches cryptocurrency peer-to-peer payments for Bitcoin, Ethereum, and PYUSD in the US
- New PayPal links feature creates shareable payment links for text, email, and chat transfers
- Users can send crypto to PayPal/Venmo accounts and external cryptocurrency wallets
- Personal crypto transfers between friends and family remain exempt from IRS tax reporting
- Service expands to UK, Italy, and other markets later in 2025
PayPal has launched cryptocurrency peer-to-peer payments, allowing its 400 million users to send Bitcoin, Ethereum, and PYUSD stablecoin directly to friends and family. The feature marks a major expansion of crypto utility beyond trading and investment.
The payments giant announced the service Monday alongside PayPal links, a new tool that generates personalized payment links. Users can share these one-time links through text messages, email, or chat applications for instant money transfers.
The crypto P2P system works across PayPal and Venmo platforms. Users can send digital assets to other PayPal accounts, Venmo users, and external cryptocurrency wallets that support these currencies.
PayPal confirmed that personal transfers between friends and family will not trigger IRS 1099-K tax reporting requirements. This exemption covers crypto gifts, expense sharing, and reimbursements between personal contacts.
US Launch Before International Rollout
The cryptocurrency peer-to-peer service launches first in the United States. PayPal plans international expansion to the United Kingdom, Italy, and additional markets throughout 2025.
Supported cryptocurrencies include Bitcoin, Ethereum, and PayPal’s PYUSD stablecoin. PYUSD has grown to nearly $1.3 billion in market capitalization since its launch.
Both features operate under PayPal World, the company’s interoperability framework connecting different payment systems globally. Consumer payment volume increased 10% year-over-year in the second quarter, with P2P payments driving growth.
PayPal has expanded crypto services throughout 2025. The company launched “Pay with Crypto” for US businesses, accepting over 100 cryptocurrencies. April updates added Chainlink and Solana to PayPal and Venmo crypto options.
Bridging Traditional and Crypto Payments
The new P2P feature allows cryptocurrency transfers to external wallets, aligning with Bitcoin’s original peer-to-peer vision from Satoshi Nakamoto’s white paper. This bridges centralized payment processing with decentralized cryptocurrency networks.
Competitors are making similar moves. Kraken launched its Krak payments app in June for cross-border digital asset transfers. The World Bank estimates stablecoin payment rails could reduce transaction costs by 92%.
However, the Bank for International Settlements has raised concerns about stablecoins functioning as true currency, arguing they behave more like financial assets.
PayPal’s crypto P2P system represents the company’s continued push into digital currency payments. The feature enables practical cryptocurrency use beyond speculation and trading.
The service starts with Bitcoin, Ethereum, and PYUSD support, with plans for additional cryptocurrencies. Users can access the feature through the PayPal mobile app and web platform.
PayPal links work independently of cryptocurrency, supporting traditional currency transfers through the same shareable link system. The company expects the combined features to increase user engagement and payment volume.
