PayPal releases a safe coin called PYUSD, backed by the U.S. dollar.
PayPal USD is built on Ethereum and can be exchanged for U.S. dollars at a rate of one-to-one.
PayPal is making its stablecoin, called PayPalUSD (PYUSD). The company says that the cryptocurrency coin is “fully backed by U.S. dollar deposits” and that it can be bought or sold on PayPal’s app or website for $1.00 per PYUSD.
With PYUSD, you can send money from one person to another, pay for items at checkout, and move PYUSD between PayPal and other wallets. PayPal says that you can also change the currencies that PayPal supports into and out of PYUSD.
Stablecoins get their name from the fact that they are backed by government-backed currencies like the U.S. dollar or the Euro. The U.S. government is still trying to figure out how to regulate stablecoin and other types of cryptocurrency. After all, Tether and TerraUSD showed that stablecoins are only sometimes that stable.
PYUSD is starting today and will be available “in the coming weeks” to PayPal Balance account holders in the U.S. It will also be on the Venmo app, owned by PayPal, “soon.”
It’s not a big surprise that PayPal is making its stablecoin since the PayPal app already lets users buy, move, and sell cryptocurrencies like Bitcoin, Bitcoin Cash, Ethereum, and Litecoin. Last year, it also got its New York BitLicense, which lets people in that state buy and sell Bitcoin. In a larger sense, the U.S. government has been thinking about making its digital currency.
The stablecoin is based on Ethereum and is given out by the Paxos Trust Company, a New York-based company that offers clients a controlled blockchain infrastructure. New York officials have recently told Paxos to stop selling Binance’s BUSD cryptocurrency. This is part of a crackdown on businesses in the cryptocurrency industry by the state.
Dan Schulman, the president and CEO of PayPal, said, “The move towards digital currencies needs a stable instrument that is both digitally native and easy to connect to fiat currency like the U.S. dollar.”