Android remains open source via the Android Open Source Project.
The vast majority of Android apps including PayPal work fine on GrapheneOS.
PayPal recently shipped incorrect anti-tampering code incompatible with our secure spawning feature. The feature spawns app processes with exec to provide their own address space layout randomization, random memory tags and canaries. We're aware of these kinds of incompatibilities and provide a per-app toggle for exec-based spawning which works for PayPal. PayPal made a mistake and didn't consider GrapheneOS as part of this recent change. They'll likely fix it since they don't ban using GrapheneOS and likely want it working on GrapheneOS.