Bull Market Catalyst? PayPal Collaborates with Paxos to Launch First Stablecoin: PayPal USDPYUSD

The global payment giant PayPal has partnered with the stablecoin issuer Paxos to launch the new stablecoin, PayPal USD. The introduction of PayPal USD comes at a time when the market is anticipating the US House of Representatives to vote on a significant stablecoin bill, which is under consideration along with three other cryptocurrency bills.

PayPal USD Innovates Payment Methods, Breaking Payment Barriers in the Virtual Environment

According to CNBC, PayPal USD is designed to address the shift in payment methods within the "web3" and digital native environment.

The stablecoin aims to reduce obstacles in payments within the virtual environment, allowing funds to flow directly to developers and be exchangeable for US dollars. Its reserve assets include US dollar deposits, short-term US Treasuries, and other similar cash equivalents.

PayPal's President and CEO, Dan Schulman, stated, "Transitioning to digital currencies requires a stable tool that is both digitally native and easily connectable to fiat currencies like the US dollar. We are committed to responsible innovation and compliance, and the successful track record of providing new experiences to customers has laid the necessary foundation for the growth of digital payments with PayPal USD."

PayPal USD PYUSD: Making US Payments More Convenient, Supporting Ethereum

PayPal stated that PayPal USD PYUSD can serve as a crypto payment option at millions of online stores, where PayPal will sell customers' PYUSD for purchasing goods.

PayPal USD PYUSD also allows users to transfer funds to each other, with PayPal mentioning that sending PYUSD to friends within the US is fee-free, and it can also be transferred to Ethereum wallets that support PYUSD.

PayPal Stock Rises, Banking on Stablecoin PayPal USD

Following PayPal's announcement, its stock price rose by over 1%. PayPal USD is issued by Paxos, the same company that previously issued the stablecoin BUSD pegged to the US dollar. However, in February of this year, the New York State Department of Financial Services required Paxos to halt the issuance of BUSD, causing the stablecoin market value to decline. Nonetheless, the market seems to hold high expectations for PayPal USD.

Recap: Why did the SEC accuse Binance's BUSD of being a security? How did Paxos and Binance profit from BUSD?