In one word, No, you cannot. Bitcoin and PayPal have never been friends. Not only do they work differently, but also they are ideologically and historically different. to understand better, we have to inquire into the founding and propagation of these two payment systems.
A Brief History of PayPal
PayPal is probably the oldest online payment system. It was first named Confinity and was founded by Max Levchin, Peter Thiel, and Luke Nosek in 1998. The idea was to have an electronic wallet system that can be used to purchase things online without the shopper having to expose his/her credit card number.
At that time period, Elon Musk was running a financial services website X.com (Not the twitter today). He was very interested in Confinity and merged the two companies in 2000. It was named PayPal in 2001.
In 2002, eBay bought PayPal and the expansion started. Almost all transactions on eBay was going through PayPal, and it became the world-renowned payment system that it is today.
A Brief History of Bitcoin
Bitcoin started a lot later (2008-2009). The idea of Bitcoin is a lot more complex and unless you are a computer cryptographer, you won’t understand much of it.
Suffice it to say that the initial thought was that solving complex mathematical computation should be worth something. In 2008, Satoshi Nakamoto proposed in a well-written white paper that an online ledger system called blockchain can record this computational work with an assigned currency called Bitcoin.
The transfer of Bitcoin from one person to another is also done through blockchain. Blockchain severs are constantly updated when transfers happen without the need for a bank.
Now that we understand the history, we know the only similarity between PayPal and Bitcoin is that they are both electronic wallets. Let us look into how they are different and why you cannot buy Bitcoin using PayPal.
PayPal
- PayPal is an electronic wallet that runs on regular fiat currencies.
- PayPal has its own policies but is also regulated by the financial authorities (Central Bank) of the countries it operates in.
- PayPal transfers still go through banks.
- PayPal transfers are reversible. If you are unsatisfied with a product or service, you can lodge a complaint to PayPal and based on the merit PayPal might return your money.
- PayPal wallets are attached to the name, email address, and phone number of the wallet holder. You can always see who sends the money and who receives it.
Bitcoin
- Bitcoin is a currency on its own. Its electronic wallet is a numbered address issued by blockchain system.
- Bitcoin has no central authority and is not regulated by any bank because is it not a regular currency.
- Bitcoin transfers are simply updated by the blockchain ledger.
- Bitcoin transfers are irreversible. Once the ledger has been updated ad money is transferred from your wallet to another, you cannot get it back because there is no one to complain to.
- Bitcoin wallet is a numbered wallet attached to an email address. You can never see the name of the person who sends or receives the money.
Why You cannot Buy Bitcoin Using PayPal
One important difference why you cannot buy Bitcoin using PayPal is the fact that PayPal payments are reversible, and Bitcoin payment are not. Another one is that PayPal transactions are attached to the persons while Bitcoin is a direct wallet to wallet transfer.
Say you find a Bitcoin vendor who allows you to buy Bitcoin using PayPal. he sends you the Bitcoin and you pay him in dollar using your PayPal. A day later, you can file a dispute on PayPal and claim your money back. And since the vendor can;t prove that he sent Bitcoin to you (your wallet because the wallet is just a number), PayPal will have no choice but to refund your money.
Therefore, the vendor loses everything. He loses his Bitcoins and he loses his money. This is the single reason why you cannot buy Bitcoin using PayPal, nor should you sell Bitcoin using PayPal unless you have found a reliable organization (not a person) like Vimo Exchange.
If you have more questions about how Vimo Exchange operates, you should read our FAQ page.