We're experiencing the same problem, unfortunately. It appears to be a site-wide problem that affects European sellers.
From what we've observed by looking at other sellers, there seems to be a cutoff around July / August of last year. Shops opened after that date seem unable to offer PayPal as a payment option. As far as I was able to tell, only EU sellers are affected.
My personal speculation is that Etsy might be trying to phase out PayPal because it's costly for them. But instead of removing it for all shops worldwide, which could upset sellers with high-performing stores, they’ve quietly stopped offering it to new shops instead. Of course, this is just a theory, and I don’t have any concrete evidence to back it up.
If that’s really the case though, it creates an unfair two-tier system: older shops with more payment options, and newer ones that are at a disadvantage from the start (And it's worth pointing out that new shops pay the same listing fees as everyone else when adding products, so they should receive the same level of service).
Etsy hasn't provided any official explanation, and in our case Etsy support has ghosted us. It's really frustrating.
I’d encourage everyone affected by this to reach out to Etsy Support. If enough of us speak up, we might eventually get some clarity, or even a solution.
