PayPal launches ERC20 stablecoin ‘PYUSD’ with Paxos

In a move signaling the significant shift towards digital currencies, PayPal has announced the launch of its U.S. dollar-backed stablecoin – PayPal USD (PYUSD).

This development, announced by PayPal directly, adds a new dimension to the emerging potential of regulated, fully-backed stablecoins in transforming payments in digitally native environments like web3.

The news comes after progress on the project was said to have stalled in February. A company representative told Bloomberg then, “We are exploring a stablecoin…If and when we seek to move forward, we will, of course, work closely with relevant regulators.”

PYUSD is fully backed by U.S. dollar deposits, U.S. Treasuries, and similar cash equivalents, providing a one-to-one redemption for U.S. dollars. Further, the company confirmed that the stablecoin will be available for U.S. customers.

Additionally, according to the terms listed in the announcement, it appears that PYUSD may become the native token of PayPal’s crypto service with no “spread” charged on the swaps.

“When you buy or sell cryptocurrency, including when you check out with crypto, we will disclose an exchange rate and any fees you will be charged for that transaction.

For currencies other than PayPal USD, the exchange rate includes a spread that PayPal earns on each purchase and sale. PayPal USD is not available in Hawaii.”

Acknowledging the need for a stable, digitally native instrument easily connected to fiat currency, Dan Schulman, President and CEO of PayPal, expressed the company’s commitment to innovation and compliance,

“Our track record delivering new experiences to our customers provides the foundation necessary to contribute to the growth of digital payments through PayPal USD.”

As an ERC-20 token issued on the Ethereum blockchain, PayPal USD aims to seamlessly bridge the gap between fiat and digital currencies for consumers, merchants, and developers. The new stablecoin is expected to facilitate fast transfers of…