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Introduction
Making payments online is fast-becoming commonplace. It’s something people do every day. They do it almost without thinking.
It’s just like paying in cash used to be. So quick.
But now paying online through digital technology, platforms, devices are overtaking cash payments.
It’s driving cash out of business.
That’s why major corporations are scrambling to transition to this evolving situation. Even the giants of the traditional banking world.
It’s why established payment platforms such as PayPal are making strides to integrate with emerging technologies. To ensure they remain at the forefront of the crypto revolution.
Introducing PYUSD!
That’s the crypto market ticker name of PayPal’s new Etheruem-based stablecoin PayPalUSD, launched to a great fanfare of excitement around the world.
For those new to the term, a stablecoin is a type of cryptocurrency that aims to hold a stable value by tying itself to a reserve, often a currency like the US dollar. The idea is to combine the benefits of digital currency with the stability of traditional currency.
Putting it mildly, this is a HUGE move by PayPal.
When a big player like PayPal takes a step into the cryptocurrency world, it gets people sitting up. They take notice.
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Three Reasons Why PayPalUSD is a Massive Development
Validation
Quite simply, that means the crypto market is being recognised as a legitimate worldwide domain. That cryptocurrencies are here to stay. More than that, they could well be the lynchpin of modern society.
For those who are still hesitant about crypto, or suspicious of it, the likes of PayPal getting involved brings confidence. It helps the crypto-hesitant build trust.
Adoption
It’s not only cryptos that are being more widely adopted by mainstream companies. There’s the use of stablecoins too.
Stablecoins are tied to a recognised, traditional reserve currency, so that too fosters greater trust.
There’s also the fact that cryptos are helping pave the way for faster, more seamless transactions across borders.
When PayPal gets involved, it may potentially influence traders and businesses to adopt it for regular transactions.
Diversification
For investors and traders, the launch of PayPal USD offers a new instrument to their portfolio.
The fact that the value of PYUSD is stable, will no doubt be of great interest to investors. Because the broader ecosystem it represents can be areas of exploration and potential investment. This includes Ethereum and other Web3 technologies.
100% Backed by USD
In simple terms, PayPal USD can be bought or sold through PayPal at a rate of $1.00 per PayPal USD.
As of now, eligible US PayPal customers can use PayPal USD to:
- Make transfers between PayPal and PayPal USD, and other wallets
- Use PayPal USD to send peer-to-peer payments
- Make purchases
- Use PayPal USD to convert any of PayPal’s supported cryptocurrencies
PayPal USD is also designed to:
- Reduce friction for in-experience payments in virtual environments
- Help conduct international payments,
- Enable direct flows to developers and creators
- Foster the continued expansion into digital assets by the largest brands in the world
According to PayPal CEO, Dan Shulman, PayPal’s commitment to “responsible innovation” along with its track record in delivering “new experiences” to its customers provides the “foundation necessary” to contribute to the growth of digital payments.
PayPal USD will also be the only stablecoin supported on the PayPal platform, which gives it a certain exclusive kudos.
It’s worth noting that stablecoins are sometimes used to trade in and out of other crypto assets. The fact they don’t enter the traditional financial system, means traders can enter and exit positions faster and more cheaply than, say, using the traditional “paper” dollar.
Conclusion
As we hope you have identified from our research, PayPal’s entry into the stablecoin market with PYUSD is profoundly significant. Not only from a consumer point of view, but as a tool for wealth investment.
For students and budding investors, it’s essential to understand the implications of such developments.
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