PayPal stated in an email to select users on Aug. 14 that it will be temporarily pausing crypto purchasing services in the UK for the next few months.
That notice states that service will be paused from October 1, 2023 and will resume at an undetermined date in early 2024.
While buying won’t be available, PayPal said users will be able to keep and sell their cryptocurrency during the service outage. The company has not specified whether users will be able to transfer cryptocurrency to other wallets and exchanges, although it appears that this feature is currently only available to users in the US.
The company assured users that their crypto will remain safe and said no fees will be charged. It apologized for the inconvenience to customers.
UK rules require updated compliance
PayPal said it is pausing crypto purchases due to the introduction of new rules from the UK’s Financial Conduct Authority (FCA). It said those rules require it to take “additional steps before customers can buy crypto”.
The company does not specify which rules are involved. The UK will begin enforcing a Crypto Travel Rule in September 2023 that requires crypto companies to collect information about parties involved in transactions, although the September deadline of this rule does not seem to match PayPal’s service change in October.
The FCA also recently introduced new promotion rules that aim to determine how crypto can be promoted or advertised to potential investors. These rules go into effect in October, but they don’t seem to match PayPal’s description of user-facing requirements.
PayPal’s reduced UK services are particularly notable due to the fact that the company is expanding its crypto offerings in the United States.
The company said it would offer its own USD stablecoin on August 7. Later, a PayPal executive suggested that the stablecoin could be used extensively in DeFi. Other reports suggest that the company is combining its functions into a “Cryptocurrency Hub”.
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