PayPal has announced the launch of its native U.S. dollar-pegged stablecoin called PayPal USD (PYUSD) based on the Ethereum blockchain.
First Global Payments Company to Launch a Stablecoin
On Monday, August 7, digital payments giant PayPal announced the official launch of its Ethereum-based stablecoin pegged to the U.S. dollar. PayPal USD (PYUSD) will become available to the eligible U.S. customers in the upcoming weeks.
The ERC-20 stablecoin can be used for transfers between PayPal and supported external wallets, person-to-person payments, funding purchases, and converting any of the platform’s listed digital assets to and from PayPal USD.
“The shift toward digital currencies requires a stable instrument that is both digitally native and easily connected to fiat currency like the U.S. dollar,” commented Dan Schulman, president and CEO, PayPal. “Our commitment to responsible innovation and compliance, and our track record delivering new experiences to our customers, provides the foundation necessary to contribute to the growth of digital payments through PayPal USD.”
According to the company’s statement, PYUSD will serve as a bridge between fiat and Web3 for consumers and merchants, will be available to external developers, wallets and web3 applications, can be seamlessly adopted by exchanges, and used as a driving force behind many experiences in the PayPal ecosystem.
The issuer of PayPal USD is Paxos Trust Company, a fully licensed New-York based financial institution specializing in blockchain. PYUSD reserves are fully supported by U.S. dollar deposits, U.S. Treasuries and similar cash equivalents. PayPal USD can be bought or sold at a fixed rate $1 per PYUSD via PayPal.
Starting from September 2023, Paxos will be publishing a public monthly Reserve Report for PayPal USD, and a public third-party attestation of the value of PayPal USD reserve assets.
“In addition to building products and services that add utility to digital currencies, PayPal is focused on increasing consumer and merchant comprehension of cryptocurrencies, stablecoins and central bank digital currencies (CBDCs), while working closely with regulators as the industry evolves.” reads the PayPal press release.
PayPal Continues Integration of Crypto
PayPal first confirmed its exploration of stablecoins back at the beginning of last year, although in February 2023 it reported to have halted the project due to regulatory scrutiny in the U.S. The release of PYUSD might mean that the company and its stablecoin issuer Paxos have finally reached an agreement with its persecutors.
The prominent fintech company has been actively exploring and integrating crypto services for the last couple of years. PayPal has recently revealed that it’s holding almost $1 billion worth of crypto on behalf of its clients.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
Credit: Source link
