For years, cryptocurrency has been hailed as a technology that would supplant centralized payment services because it could make transactions cheaper and cut out the financial intermediary.
But more and more, those legacy services are looking to incorporate crypto into their toolkits.
Today, PayPal confirmed that it is working on its own stablecoin after a developer discovered language about a "PayPal Coin" within its iPhone app. Bloomberg was the first to report the news.
PayPal told Bloomberg the code was part of a hackathon and wouldn't necessarily be representative of the final version.
"We are exploring a stablecoin," Senior VP of Crypto and Digital Currencies Jose Fernandez da Ponte told Bloomberg. "If and when we seek to move forward, we will of course, work closely with relevant regulators."
Stablecoins: What Are They Good For?
Stablecoins are at the heart of some of the biggest controversies in the crypto industry today—and yet more of them keep coming. On an almost weekly basis, companies and protocols keep announcing new stablecoin moves. So, what’s behind the boom? A stablecoin is a type of cryptocurrency intended to have a stable (or relatively stable) price, typically pegged to the value of a government-issued currency like the U.S. dollar. The appeal is clear: enter the cryptocurrency market while avoiding the v...
Stablecoins are cryptocurrencies that maintain a steady value by being backed by another asset. Tether (USDT) and USDC, the two largest stablecoins by market capitalization, are designed to always be worth $1. They're useful for navigating blockchain-based platforms that eschew traditional currencies for regulatory or other reasons; they maintain their value so people can shift their portfolios.
For a major company, PayPal has already waded fairly deep into the cryptocurrency waters. In late 2020, it began enabling users to buy, hold and sell digital assets such as Bitcoin and Ethereum. It then extended that to its subsidiary, Venmo, and created a "checkout with crypto" feature for paying merchants.
PayPal CEO Reveals Plans for New Crypto Unit
PayPal is riding high. The company posted blowout fourth quarter 2020 financial results last month thanks to spectacular growth in its core app and Venmo unit, and from the success of its new buy-now-pay-later service. The firm is expecting an even bigger 2021 as the pandemic leads more consumers to embrace e-commerce and to turn away from cash altogether. None of this means that CEO Dan Schulman is resting easy, however. In an exclusive interview with Decrypt, Schulman explained how PayPal is r...
As part of its crypto strategy, it partnered with Paxos, a fintech startup that issues the Pax Dollar (USDP) stablecoin. USDP's market cap stands at just over $1.05 billion, up from around $500,000 last year, according to CoinGecko. By contrast, USDT has a market cap of $79.2 billion, up from $23.5 billion a year ago.
For its part, PayPal has a market cap of $220 billion. Its own stablecoin could be valuable indeed.
