Summary:
- PayPal announces the launch of its US dollar backed stablecoin to tap into the potential of stablecoins for payments.
- The stablecoin, named PayPal USD, is fully backed by US dollar deposits and short term treasuries, issued by Paxos Trust Company.
- US customers will soon be able to use PayPal stablecoins for transfers, payments, purchases, and conversions with other supported cryptocurrencies.
- PayPal's stablecoin release coincides with regulatory efforts around stablecoins, with differing opinions between Republicans and Democrats.
- House Financial Services Committee Chairman Patrick McHenry emphasizes the need for comprehensive regulation and consumer protection for stablecoins.
- PayPal's stablecoin is set to expand its availability by being introduced on the Venmo platform.
PayPal announces the launch of its US dollar backed stablecoin. With this release now, the fintech company aims to contribute to the opportunity stablecoins offer for payments.
PayPal officially announcing its first ever US dollar backed stablecoin to connect fiat dollars with cryptocurrencies. Known as PayPal USD, the stablecoin is 100% backed by US dollar deposits, short term US treasuries and cash equivalents. It is redeemable one for one for US dollars and is issued by Paxos Trust Company. Starting today and rolling out in the coming weeks, PayPal says US customers who purchase PayPal's stablecoin will be able to transfer PayPal stablecoins between PayPal and compatible external wallets, send individual payments, fund purchases and convert any cryptocurrencies supported by PayPal to and from PayPal's stablecoins. PayPal's launch of a stablecoin comes just after the Republican-led House Financial Services Committee passed legislation at the end of July to regulate stablecoins. Democrats also dislike that the bill grants no actual enforcement authority to the Federal Reserve for issuers with state licenses.
House Financial Services Committee Chairman Patrick McHenry emphasized the importance of clear regulations and consumer protections for stablecoins. PayPal also plans to make its stablecoin available on Venmo.
PayPal's entrance into the stablecoin market represents a significant development in the intersection of traditional finance and cryptocurrencies, sparking further discussions about regulatory frameworks and consumer safeguards.