PayPal Ends Buyer and Seller Protections for NFTs


SAN FRANCISCO, Monday, May 27, 2024 – PayPal has rolled back protections for users involved in non-fungible token (NFT) transactions. Effective May 20, 2024, purchases of NFTs will no longer be covered by PayPal’s buyer protection program. 1

Additionally, seller protection for NFT sales exceeding $10,000 is now limited.2

The change was first seen on PayPal’s policy page. 3

This change reflects concerns within PayPal regarding the evolving NFT market, particularly challenges in verifying order fulfilment.

Previously, NFT transactions enjoyed coverage under PayPal’s standard buyer and seller protection programs. These programs typically reimburse users in cases of fraud or non-delivery of goods.

For NFT sales exceeding $10,000, sellers will no longer be shielded from claims of misrepresentation, unauthorized transactions, or other scams.

However, sellers will retain some protection for sales under $10,000, provided the buyer’s claim aligns with eligibility requirements.

The move aligns NFTs with financial products and investments, which are also excluded from PayPal’s buyer protection program.

Sources
  1. finance.yahoo.com: https://finance.yahoo.com/news/paypal-ends-nft-purchase-protections-172101456.html[↩]
  2. theblock.co: https://www.theblock.co/post/288666/paypal-removes-buyer-and-seller-protections-for-nfts[↩]
  3. paypal,com: https://www.paypal.com/us/legalhub/upcoming-policies-full[↩]
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