According to recent changes in PayPal's terms of service, the financial services company is adjusting its policies regarding the purchase and sale of non-fungible tokens (NFTs). Effective May 20, the company will no longer provide buyer protection for NFT purchases under the new policy.

Furthermore, PayPal will no longer guarantee protection for NFT sales exceeding $10,000 against false claims, chargebacks, or other fraudulent activities that could result in financial losses for sellers. While a notice about these changes was published on March 21, it has only recently come to light.

In its official announcements, PayPal stated that starting from May 20, 2024, their Purchase Protection program will no longer cover NFT transactions. These updates were shared on PayPal's policy updates page and emphasized the exclusion of NFT transactions exceeding $10,000 from the Seller Protection Program.

Previously, PayPal's buyer and seller protection programs provided support for NFT purchases and sales, but the company has recently restricted the assistance offered to sellers of tokens. The old program offered refunds to buyers for products that were falsely advertised and purchased using PayPal, while also reimbursing sellers who experienced losses due to payment disputes or fraudulent refund claims.

Over the years, PayPal has gradually shown more interest in blockchain-based cryptocurrencies, with the company introducing support for cryptocurrencies on its platform in 2022. There were also reports of PayPal filing a patent application for an NFT purchase and transfer system that would provide users with royalties and rewards.