PayPal and Venmo integrate ENS to simplify crypto transactions with .eth names.
PayPal has been expanding its web3 efforts and enhancing crypto services since 2020.
However, PayPal’s stablecoin, PYUSD, has seen a significant market cap drop, mainly on Solana’s network.
PayPal and Venmo have introduced support for Ethereum Name Service (ENS) domain names. This new feature, initially available to US users, allows for streamlined cryptocurrency transactions using easily recognizable ENS names instead of complex wallet addresses.
The move simplifies crypto payments, aligning with PayPal’s broader push into web3 and its expanding crypto offerings, including the PYUSD stablecoin.
🚀 We’re thrilled to announce that @ensdomains is now supported on @PayPal & @Venmo!
This new feature brings the power of ENS to millions, making crypto transfers easier and more secure than ever—starting in the USA.🌐 pic.twitter.com/9hsrhRqEAp
— ens.eth (@ensdomains) September 10, 2024
Simplifying crypto transactions for PayPal and Venmo users
The integration of Ethereum Name Service (ENS) into PayPal and Venmo marks a significant step toward improving the user experience within the crypto space.
Traditionally, sending cryptocurrencies has required users to input long, complex alphanumeric wallet addresses, creating friction and increasing the risk of errors.
ENS simplifies this process by allowing users to link their wallet addresses to easily readable “.eth” domain names. With this feature, users can now send and receive payments by simply entering an ENS name, making cryptocurrency transactions more intuitive and user-friendly.
Khori Whittaker, Executive Director of ENS Labs, expressed excitement about the partnership, stating that they are “excited to bring ENS’ naming capabilities directly into the hands of millions of users through Venmo, PayPal Mobile, and PayPal Web.”
This integration aims to streamline wallet address management and reduce the risks associated with incorrect payments.
ENS, which has been operational since 2017, has registered more than 4 million domain names, showing the growing demand for user-friendly solutions in the web3 ecosystem.
PayPal’s ongoing web3 push
PayPal has been actively expanding its presence in the web3 space since 2020 when it first allowed users to buy, hold, and sell cryptocurrencies such as Bitcoin, Ethereum, and Litecoin. This service was initially made possible through a partnership with Paxos Trust Company, a regulated provider of cryptocurrency services.
Venmo followed suit in 2021, offering its users similar features.
In addition to the ENS integration, PayPal launched its own stablecoin, PayPal USD (PYUSD), in collaboration with Paxos in August 2023 initially on Ethereum before later launching it on Solana in May 2024.
PYUSD is backed by US dollar deposits and short-term US Treasuries, ensuring a 1:1 ratio with the US dollar. It is issued as an ERC-20 token on the Ethereum blockchain and has been integrated with the Solana blockchain, expanding its functionality across networks.
PYUSD market cap decline
Despite PYUSD’s initial success, with its market cap surpassing $1 billion on August 24, the stablecoin has faced recent challenges.
As of early September, PYUSD’s market cap had dropped by 17%, with the majority of the decline occurring on Solana. The stablecoin’s Solana deployment saw a 21.5% decrease in market cap, dropping to $507.5 million, while its Ethereum deployment remained more stable, only falling 3% to $351.8 million.
This decline comes amid PayPal’s broader efforts to establish PYUSD as a trusted stablecoin in the market.
Nonetheless, PayPal and Venmo’s ENS integration demonstrates the companies’ commitment to enhancing the user experience and making cryptocurrency transactions more accessible to a wider audience, particularly as digital assets continue to gain mainstream adoption.
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