PayPal Holdings Inc. has launched a US dollar stablecoin, PYUSD, marking the first such initiative by a large financial company. This move could potentially enhance the slow adoption of digital tokens for payments.
PYUSD is issued by Paxos Trust Co. and is fully backed by US dollar deposits, short-term Treasuries, and similar cash equivalents. The stablecoin is pegged to the dollar and will be gradually made available to PayPal’s customers in the US [1].
PYUSD is redeemable 1:1 for US dollars and is designed to contribute to the opportunities stablecoins offer for payments. Starting from the launch date and rolling out in the coming weeks, eligible US PayPal customers who purchase PYUSD will be able to transfer PYUSD between PayPal and compatible external wallets, send person-to-person payments using PYUSD, fund purchases with PYUSD by selecting it at checkout, and convert any of PayPal’s supported cryptocurrencies to and from PYUSD [2].
PayPal USD will be available to consumers, merchants, and developers to seamlessly connect fiat and digital currencies. As the only stablecoin supported within the PayPal network, PayPal USD leverages PayPal’s decades-long experience in payments at scale, combined with the speed, cost, and programmability of blockchain protocols. It is an ERC-20 token issued on the Ethereum blockchain [2].
