You might remember that in March 2021, PayPal unveiled the “Checkout with Crypto” feature, allowing its U.S. customers to use cryptocurrency for payments alongside other methods in their wallet. Following suit, in August of that year, the international payments leader extended the same program to the UK.
Jumping ahead nearly two years, PayPal has just revealed the launch of PayPal USD (PYUSD), a novel stablecoin backed by the U.S. dollar, designed for seamless payments. As detailed in the announcement, Paxos Trust Co. will issue this new stablecoin, ensuring complete backing by U.S. dollar deposits, short-term Treasuries, and equivalent cash holdings.
Furthermore, the payment company emphasized that PYUSD will always be convertible to the U.S. dollar and will also allow for swapping with other cryptocurrencies within the ecosystem. The platform has also confirmed that this fresh stablecoin will soon serve as a payment method for a variety of transactions and can be smoothly transferred between PayPal and Venmo.
Built on the Ethereum blockchain and tailored for digital payments and the Web3 ecosystem, PYUSD is poised to soon become accessible to customers in the United States, as announced by PayPal. This strategic move aligns seamlessly with the company’s overarching ambition to establish itself as a significant player in the cryptocurrency payment arena—a journey embarked upon in 2020 with the introduction of crypto transactions on its platform.
With a colossal user base exceeding 350 million, the US Company has already enabled users in the U.S. and U.K. to seamlessly engage in buying, selling, and holding cryptocurrencies like Bitcoin (BTC), Ether (ETH), Bitcoin Cash (BCH), and Litecoin. These digital assets can also be utilized for various payment purposes.
Dan Schulman, PayPal’s CEO, envisions this novel stablecoin, PYUSD, as an integral component of the broader payment infrastructure. The company officially unveiled its stablecoin intentions in January 2022, emphasizing its commitment to close collaboration with regulatory bodies throughout the development process.
In a notable move, PayPal is on the verge of introducing the inaugural stablecoin from a major player in the payment processing realm. Although various stablecoins already exist within the cryptocurrency landscape, the US Payment provider is gearing up to make history by becoming the first prominent payment processor to launch its own stablecoin. Charles Cascarilla, CEO of Paxos, shared his insights with Cointelegraph, stating:
“Through the launch of the inaugural stablecoin by a leading financial institution, PayPal and Paxos are substantiating the tangible value of blockchain technology. PayPal USD represents a momentous stride in the evolution of digital assets and the financial sector, and Paxos is honored to facilitate the realization of this transformative product.”
Simultaneously, PayPal boasts a staggering global user base of over 403 million active accounts and collaborates with more than 29 million merchants. This new offering has the potential to play a crucial role in catalyzing the widespread adoption of cryptocurrency across the globe.