The value of crypto assets such as bitcoin, ether, and dogecoin have increased in recent weeks thanks to strong market sentiment and the rise of non-fungible tokens, among other factors. Some companies, including Tesla Inc.

and Square Inc., earlier this year, disclosed the companies’ investments in cryptocurrencies.

However, most CFOs have been cautious so far, pointing out the risks associated with spending the company’s cash on bitcoin and other crypto assets. “We manage our cash flow in a very consistent manner,” said Mr. Rainey of PayPal. The company had $ 19.1 billion in cash, cash equivalents and investments at the end of its most recent quarter.

PayPal, based in San Jose, California, introduced a feature in November that allows most U.S. customers to buy, sell, and hold bitcoin, ether, litecoin, and Bitcoin Cash. Earlier this year, he launched an option allowing people to use their holdings in these currencies to pay traders.

These transactions are more attractive to PayPal than those involving a credit or debit card because no card issuer or network provider needs to be paid. The payment company still charges its merchants a standard transaction fee of around 2.9%, but manages to hold onto more of that money, Mr Rainey said. “It’s a high margin transaction for us,” he said.

PayPal must pay Paxos Trust Co., a company that converts crypto assets into US dollars before they are sent to the merchant. The execution risk lies with Paxos, Mr Rainey said.

PayPal reported revenue of $ 6.03 billion for its most recent quarter on Wednesday, up 29% from the previous year period. Total payment volume increased 46% to $ 285.45 billion. The company now expects payments volume to grow by around 30% this year, up from its earlier forecast of the high 20% range.

Building its crypto offering allows PayPal to connect with customers who are more engaged than those who use other payment methods, said Harshita Rawat, managing director and senior research analyst at financial services firm AllianceBernstein Holding. LP. About half of PayPal’s crypto users open its app every day, the company said.

“Cryptocurrencies and the underlying technology have become a major strategic focus for the company,” Ms. Rawat said.

Write to Nina Trentmann at [email protected]