American multinational company, PayPal, has revised its Seller Protection program to exclude non-fungible token (NFT) transactions that surpass $10,000.
Limiting NFT Transactions
According to PayPal’s Policy Updates page, NFT transactions valued at more than $10,000 are ineligible. The changes will come into effect from March 21 this year.
A document further elaborating stated that items or transactions such as art, media, antiques, or collectibles, physically or digitally, as represented by an NFT worth more than $10,000 or equivalent value in local currency, as calculated at the time of the transaction, will not be eligible for its Seller Protection Program.
“Revising PayPal’s Seller Protection program to expand the list of ineligible items to include certain Non-Fungible Tokens (NFTs) with a transaction amount of more than $10,000 USD.”
PayPal first announced enabling users in the US to buy Bitcoin and other cryptocurrencies in October 2020. The following year, the payment processor started allowing users to spend their cryptocurrency holdings, such as Bitcoin (BTC), Ether (ETH), Bitcoin Cash (BCH), and Litecoin (LTC), at millions of online merchants across the world.
Talking about the “transitional point” of cryptocurrencies, PayPal CEO and president Dan Schulman earlier stated,
“This is the first time you can seamlessly use cryptocurrencies in the same way as a credit card or a debit card inside your PayPal wallet. We think it is a transitional point where cryptocurrencies move from being predominantly an asset class that you buy, hold and or sell to now becoming a legitimate funding source to make transactions in the real world at millions of merchants.”
Malicious Actors in NFT Space
PayPal’s move comes less than a week after the US-based NFT marketplace – Cent NFT – halted NFT sales citing rampant fraud and counterfeit digital assets.
CEO Cameron Hejazi called it a “fundamental problem” in the fast-paced world of digital assets. For the uninitiated, Cent NFT is best-known for hosting the auction of a digitalized version of former Twitter CEO Jack Dorsey’s first tweet, which was also one of the earliest NFTs to sell for more than a million dollars worth of crypto.
More recently, the tax authorities of the UK – Her Majesty’s Revenue and Customs (HMRC) reportedly seized three NFTs connected to a suspected case of such fraud estimated to be around $1.9 million.
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