PayPal entered the crypto payments space in 2020 and has been actively engaged in the sector ever since.
On August 7, PayPal, the American fintech company, introduced a new stablecoin named PayPal USD (PYUSD).
Paxos Trust Co. will issue the U.S. dollar-pegged stablecoin, which will be fully backed by U.S. dollar deposits, short-term Treasurys, and similar cash equivalents. Built on Ethereum and optimized for digital payments and Web3, it will soon be accessible to customers in the United States.
PayPal USD compatibility with crypto exchanges, Web3 apps and crypto wallets. Source: PayPal
PYUSD, the new stablecoin from PayPal, will have the feature of being redeemable for U.S. dollars at any time. Users will also be able to exchange it for other cryptocurrencies within the PayPal platform and transfer it between PayPal and Venmo accounts. Moreover, the company plans to make PYUSD available as a payment option for various purchases.
This move by PayPal to launch a stablecoin can speed up its efforts to establish itself as a major player in the crypto payment sector. The company first ventured into crypto payments in 2020 when it introduced support for cryptocurrency transactions on its platform.
PayPal has a massive user base of over 350 million active users. Currently, users in the U.S. and the United Kingdom can buy, sell, and hold popular cryptocurrencies like Bitcoin ($28,999), Ether ($1,828), Bitcoin Cash ($236), and Litecoin ($82.22). Additionally, PayPal allows payments to be made using these digital assets.
PayPal’s CEO, Dan Schulman, envisions the new stablecoin becoming an integral part of the overall payments infrastructure. The company disclosed its plan to launch the crypto stablecoin in January 2022, emphasizing its commitment to collaborate closely with relevant regulators.
While various stablecoins exist in the crypto market, PayPal’s stablecoin will be a significant milestone as the first one introduced by a major payment processor.
According to the firm, the regulatory environment surrounding stablecoins in the U.S. is gradually gaining clarity, leading to a demand for an alternative stablecoin beyond the current options available in the market. The crypto stablecoin market has a circulating supply of $126 billion, with Tether-issued USDT $1.00 dominating the market at an $86.5 billion market cap, followed by Circle-issued USD Coin $1.00 at $26 billion market cap, along with a few others.
However, numerous stablecoins have recently encountered regulatory challenges in the United States, where policymakers are currently discussing a bipartisan stablecoin bill.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
Join Cryptos Headlines Community
Follow Cryptos Headlines on Google News and Threads App
