PayPal’s recent launch of its PYUSD stablecoin has alarmed many in the cryptocurrency community. At first glance, PYUSD may seem like PayPal embracing decentralized finance. But further <a href="https://www.reddit.com/r/CryptoCurrency/comments/160wt8q/paypal_is_using_their_platform_to_pump_their_new/?utm_source=share&amp;utm_medium=android_app&amp;utm_name=androidcss&amp;utm_term=14&amp;utm_content=1" target="_blank" rel="noopener noreferrer nofollow">analysis</a> reveals PYUSD’s design systematically enriches PayPal at the expense of users and the crypto ethos. 
PYUSD leverages its position as a closed PayPal system to institute restrictive policies like prohibiting direct crypto-to-crypto trades. PayPal requires users first exchange crypto for PYUSD, then PYUSD back to crypto. This guarantees PayPal can double-dip, collecting trading fees twice on what should be a simple transaction. 
Worse still, PayPal pads these double fees with opaque price spreads, charging higher crypto prices than regular exchanges. Together, these tactics – forced PYUSD conversions, double fees, and hidden spreads – can cost users 5-6% per trade. This dwarfs the 0.1-0.5% fees of decentralized exchanges like Uniswap. 
PayPal is no stranger to leveraging closed ecosystems and lack of consumer choice to hike profits. Its history of high fees, account freezes, and poor customer service raise concerns about its practices. PYUSD extends this approach into crypto, using a private stablecoin as a money siphon. 
Some may defend PYUSD, arguing it will increase crypto accessibility. But access at what cost? Users pay exorbitant fees that negate crypto’s typical cost savings while being restricted to PayPal’s walled garden. Meaningful adoption requires open ecosystems where users control their assets. 
PYUSD is not a benign on-ramp to crypto; it is a Trojan horse designed to lock users into PayPal’s fees and control. Its centralized model countermands crypto’s decentralization. That’s why projects like MakerDAO’s DAI stablecoin present a better path – community-governed and freely accessible to all. 
The crypto community must be vigilant against old guard players co-opting crypto innovation for their own gain. Supporting decentralized finance systems aligned with crypto’s ethos is key. PayPal’s PYUSD provides a case study of how not to integrate crypto. We can and must do better for financial autonomy. 
Join us on <a href="https://twitter.com/intent/follow?screen_name=captainaltcoin" data-type="link" data-id="https://twitter.com/intent/follow?screen_name=captainaltcoin" target="_blank" rel="noopener noreferrer nofollow">Twitter</a> and <a rel="noopener noreferrer nofollow" href="https://www.facebook.com/captainaltcoin" target="_blank">Facebook</a> for the latest insights and discussions in the world of crypto. 
Explore our <a href="https://captainaltcoin.com/tag/news/" target="_blank" rel="noopener noreferrer nofollow">news section</a> and stay ahead of the curve with our expert <a href="https://captainaltcoin.com/predictions/" data-type="link" data-id="https://captainaltcoin.com/predictions/" target="_blank" rel="noopener noreferrer nofollow">price predictions</a>. 
The post <a rel="noopener noreferrer nofollow" href="https://captainaltcoin.com/paypals-trojan-horse-why-pyusd-poses-risks-for-crypto/">PayPal’s Trojan Horse: Why PYUSD Poses Risks for Crypto</a> appeared first on <a rel="noopener noreferrer nofollow" href="https://captainaltcoin.com">CaptainAltcoin</a>.

PayPal’s Trojan Horse: Why PYUSD Poses Risks for Crypto

CaptainAltcoin

Other articles published on Aug 25, 2023

How to Sell Large Amounts of Bitcoin? (2023 Guide)

Ripple vs. SEC: The trial enters a critical phase

DEA Accidentally Forwards $50,000 in Cryptocurrency to Scammer

Shiba Inu: When Will SHIB Reach $1? Here's What ChatGPT Says

HashKey To Offer BTC and Ether Retail Services In Hong Kong As The Battle For Asian Market Intens...

Tech Giants Rally Behind AI, To Fuel Skyrocketing Gains for Chainlink $LINK, Graph $GRT and Borro...

Join our free newsletter for daily crypto updates!