Bitcoin

PayPal Holdings Inc. announced on Monday the rollout of its own stablecoin, the PayPal USD (PYUSD). As the first stablecoin to be launched by a major financial company, this could significantly accelerate the adoption of digital tokens in payments. 
The San Jose, California-based payments company noted that PYUSD is issued by Paxos Trust Co., and fully backed by US dollar deposits, short-term Treasuries, and similar cash equivalents. It is pegged to the dollar and will gradually be made available to PayPal’s customers in the US. 
This move aligns with CEO Dan Schulman’s ambition to solidify <a href="https://crypto.ro/en/news/paypals-q2-earnings-fall-short-but-does-the-future-look-promising/" rel="noopener noreferrer nofollow">PayPal’s</a> digital payments dominance by leveraging technology that enables lower-cost, instant transfers without a central intermediary. Despite a slump in PayPal shares of over 35% in the past 12 months, Schulman believes that this development will form a significant part of the overall payments infrastructure in the long run. 
Stablecoins, the class of crypto tokens to which PYUSD belongs, have existed for almost a decade, but have primarily been used by traders for transferring digital assets between exchanges. However, this step by PayPal could potentially open a new avenue for consumer payments. 
Following a pause on PYUSD’s development in February due to increasing regulatory scrutiny of cryptocurrencies, PayPal believes the regulatory environment is progressing toward more clarity. With the market for stablecoins heavily concentrated, the company also sees a rising demand for an alternative option, according to Jose Fernandez da Ponte, head of PayPal’s blockchain and digital currencies team. 
PYUSD, designed to be redeemable for dollars at all times, can also be exchanged for other cryptocurrencies on PayPal’s network. It can be used for purchases and will soon be available on PayPal’s popular payments app, Venmo. Customers will also have the facility to transfer their token holdings between PayPal and Venmo wallets, and to compatible third-party wallets outside the PayPal network. 
Having launched cryptocurrency services in 2020, PayPal now allows users to buy, sell, and make payments in several tokens like Bitcoin through its platform. PYUSD is expected to be used primarily in the cryptocurrency and web3 sectors initially, before expanding its footprint into areas like remittances and micropayments. 
As part of their commitment to transparency, starting from September, Paxos will publish monthly reports detailing the assets backing PYUSD, and a third-party attestation by an accounting firm on PYUSD’s reserve assets will also be made available.

PayPal unveils its own stablecoin to boost digital payments adoption

crypto.ro global

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