I think they have a general policy against using PayPal to exchange digital currencies? The _real_ reason is that lots of scammers used paypal to buy bitcoins,

I think they have a general policy against using PayPal to exchange digital currencies? The _real_ reason is that lots of scammers used paypal to buy bitcoins, and would then initiate a chargeback. High chargeback rates are painful for payment processors, and lead them to dropping those merchants with the highest rates.