PayPal plans to modify its protection measures for NFT transactions, which is a significant departure from how it previously supported the tokens.
The payment giant is modifying the terms and conditions page of its Seller Protection Program, stating that as of May 20, Non-Fungible Tokens (NFTs) with a transaction amount of $10,000 or more will not be covered.
On March 21, the revised conditions became public, making it clear that PayPal’s buyer protection clause will no longer extend to NFT purchases. Furthermore, sellers who make NFT sales over $10,000 won’t be shielded from fraudulent charges, chargebacks, or other schemes that could endanger their finances.
This change comes after PayPal previously restricted support for NFT sellers, even though PayPal had previously refunded items that were fraudulently promoted and compensated sellers affected by payment disputes and fraudulent refund requests.
PayPal has demonstrated its increasing interest in blockchain technology and digital assets, as seen by the announcement that it will allow cryptocurrencies on its platform in 2022 and by filing a patent application for an NFT buy and transfer system that would pay user royalties.
However, these policy changes recommend a cautious approach to the thriving NFT industry. Regarding its US dollar-tied stablecoin, PYUSD, PayPal revealed in November that it had received a subpoena from the US Securities and Exchange Commission.
The subpoena was described in detail in PayPal’s 10-Q report. PayPal said it had complied with the SEC’s investigation and requested the production of information.
