Venmo, PayPal’s crypto focused app is under investigation

The United States Consumer Financial Protection Bureau is investigating PayPal’s Venmo app after the company received a civil investigative demand from the authority, on 5 February. According to reports, the Bureau has alleged that the digital wallet company conducted “unauthorized fund transfers and collections processes.”

Leading online payment company PayPal acquired Venmo in 2014 for $800 million dollars. 

Last year, PayPal said its users could purchase Bitcoin, Ethereum, Bitcoin Cash, and Litecoin through its platform. In order to allow users to avail Venmo services to trade crypto assets, PayPal received a conditional license from the New York State Department of Financial Services (NYDFS), at the time.

According to the firm’s fourth-quarter and fiscal year report about 16 million accounts are active on the platform in Q4 2020. The PayPal team stated that user activity on its network increased especially after the company introduced its crypto-friendly policies which allow its customers to buy, sell, and store digital currencies. 

The parent company planned to introduce the crypto integration service to its Venmo app this year. Additionally, in the coming months, users of Venmo will also be able to buy, hold and sell crypto in the app.