Due to concerns about "uncertainty in proof of order fulfillment" and other issues, PayPal will cancel NFT purchase protection and reduce protection for NFT sellers.
PayPal has announced that it will no longer offer buyer and seller protections for transactions involving NFTs as of May 20, marking a significant shift in the company’s approach to the digital asset market.
PayPal's protection programs have historically protected consumers from fraudulent transactions, provided refunds and protected sellers from chargebacks and false claims.
However, as confirmed by the company’s newly updated terms of service, these protections will no longer apply to any NFT-related transactions.
Large transactions
The decision mainly affects large traders. It is reported that PayPal will no longer provide protection from potential fraud for NFT transactions exceeding $10,000, whether for buyers or sellers.
The company will still allow seller protection for NFTs valued at $10,000 or less if the buyer claims the transaction was unauthorized and meets other eligibility requirements.
A PayPal spokesperson told reporters that due to concerns about "uncertainty in proof of order fulfillment" and other issues, PayPal will cancel NFT purchase protection and reduce protection for NFT sellers.
PayPal initially announced the policy change in a discreet update to its official website on March 21. The change reflects PayPal’s cautious approach to the emerging but unpredictable digital collectibles market.
Stay away from NFTs
The impact of PayPal’s updated policy is significant, marking a shift in how major financial services providers approach digital assets amid growing regulatory attention and market volatility.
By staying away from the uncertainty of the NFT market, PayPal seeks to reduce potential losses associated with fraud in the space, especially amid high volatility.
However, this conservative approach may also limit the company’s participation and growth opportunities in the emerging digital asset market. PayPal has historically been open to exploring the digital asset industry and implemented support for cryptocurrency trading in 2022.
While some industry observers believe this could reduce buyers’ confidence in using PayPal for high-value NFT purchases, it also highlights the need for consumers to be more cautious when transacting in digital assets. #PayPal #NFT交易保护
