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Topic: PayPal becomes first major fintech to launch dollar-backed stablecoin (Read 568 times)

legendary
Activity: 2268
Merit: 16328
Fully fledged Merit Cycler - Golden Feather 22-23
Nansen, a sort of Bloomberg for cryptos, did some research and found that the Stablecoin received little interest from investors and users:

PayPal's new stablecoin facing sluggish demand from crypto users, Nansen says

Main finding by Nansen:

  • Paxos still custodying more than 90% of PYUSD supply.
  • Less than ten holders that aren't contracts or exchanges have balances of more than $1,000.
  • The top holder in that category has less than $10,000 and bought the token after selling three different memecoins


I  thought we could have been in a better scenario at launch, but the race for adoption is a very long one.
hero member
Activity: 1344
Merit: 583
Wow somehow I missed this alert, but then again it has been a crazy wild month and a half for me. Pay Pal launching a stable coin I'd say is very bullish for crypto. I wonder what affect, if any this will have on BTC and other altcoins as a whole in terms of fund movement to and from their stable coin. Will PayPal try to reinvent itself and become a US crypto exchange?
copper member
Activity: 2156
Merit: 983
Part of AOBT - English Translator to Indonesia


Apparently, this might be the token since there is a lot of transaction back and forth and the holder is from Gate.io, Uniswap and Paxos itself



and they already minted 40,794,155.06 USD  Cheesy 40 million USD  Cheesy Cheesy well lets pump bTc using theSe MoNey  Cool
legendary
Activity: 3136
Merit: 1172
Leading Crypto Sports Betting & Casino Platform
While the potential is significant, the rationale behind PayPal introducing PYUSD, a stablecoin pegged to the USD, might not be immediately clear. Despite PayPal's extensive user and merchant base, the advantages of this stablecoin are not entirely evident. With PayPal already facilitating USD transactions, the introduction of a USD-backed token might seem redundant. What distinct benefits does PYUSD bring to the table?

The industry giant introduced the stablecoin PYUSD not because they wanted to adapt to the change towards the digital currency but in fact they did not want those people who want to transact in digital currency, to leave their platform. So they introduced PYUSD with the same features that give them the ability to freeze the coins anytime, thus not losing their power on the digital dollar too.

Though people will call it a stablecoin, this is not decentralized at all and those who know will never prefer PYUSD over other stablecoins.
sr. member
Activity: 658
Merit: 441
While the potential is significant, the rationale behind PayPal introducing PYUSD, a stablecoin pegged to the USD, might not be immediately clear. Despite PayPal's extensive user and merchant base, the advantages of this stablecoin are not entirely evident. With PayPal already facilitating USD transactions, the introduction of a USD-backed token might seem redundant. What distinct benefits does PYUSD bring to the table?
According to Paypal, PYUSD differs from other big players like USDT, USDC and BUSD because it reserves is in a separate New York Department and Financial Services (NYDFS) trust structure. What this means is that if PayPal or Paxos Trust Company goes bankruptcy, the funds in this reserves account will not be used to settle their debts because it's a separate fund unlike other stablecoins.

I think this is a good news because it will bring competition to the space, PayPal's PYUSD launch will keep other stablecoin brands on their toes, especially with it's large userbase. It will help in onboarding newcomers to the crypto space and promote mass adoption.
legendary
Activity: 3752
Merit: 1864

Well, you do realize that PayPal is a fully "official" payment system, plus a high-tech one, and is obliged to comply with ALL legislation.
I do perfectly realise. For this reasons I was surprised when I saw all this buzz on Twitter. I guess it was a pretty trivial to understand that.
Anyway something must really be changed recently, if the FED has stated a few rules for Banks to exchange, hold and even issue stable coins :
US Fed clarifies process for banks to transact in stablecoins
This kind of openness from the regulators, took me by suprise, also given the amount of scrutiny at the US banks have been subject to recently.

This openness is the outcome of the issuer of the stablecoin, all the rules of the regulators. This includes centralized management, de-anonymization, and account blocking mechanisms. In other words, we end up with a cryptocurrency of sorts, but... completely devoid of the key advantages of cryptocurrency. So there is nothing surprising here. I would be surprised if PayPAl was allowed to issue stablecoin without following such "centralized" rules. But anyway - we all got another convenient option for payments, and working with "crypto-fiat" Smiley
legendary
Activity: 3010
Merit: 1460
Twitter is mad at the following:



Apparently, in PayPal USD the issuer can enter an “asset protection mode” and “block” and “seize” assets.
In addition to that it can raise the max issued limit without any problems.

A lot of criticism about these features: “Bitcoin has fixed max issuance”, “Not your Keys, not your coins", "transaction censorship!" "Central issuer attack vector!"


Well... what did you expect?
If PayPal just wanted a cheap, reliable, censorship-resistant way of allowing their customer to transfer economic value, they would have implemented... Lightning.


Well, you do realize that PayPal is a fully "official" payment system, plus a high-tech one, and is obliged to comply with ALL legislation. Including the possibility of blocking assets, as it is now with accounts and accounts in the system. There is an assumption - that in this stablecoin will be realized some mechanisms from the CDBC concept. What is this about ? It means that in all CDBC implementations there is a mechanism of total control and CENTRALIZED MANAGEMENT of accounts. I.e. if a "complaint" comes in, the wallet/transaction, as if "decentralized", will be suddenly blocked.  This is not some "hidden mechanism", it is a requirement of regulators and legal framework, realized in the form of blockchain technology.

Agreed and this is not only for solving a compliance nightmare. There are some people in social media who argue that because the real value and usage of Paypal's stablecoin comes from the users' ability to legally redeem it for real dollars. According to them, asset protection mode lessens the risk for users to receive PYUSD that Paypal might not be allowed legally to redeem.

In any case, these are not my words or analysis, do not shoot the messenger heehhehe. My own analysis, I agree this is dangerous, however, what can we hope for from Paypal? We can only live in reality.
hero member
Activity: 1106
Merit: 912
Not Your Keys, Not Your Bitcoin
Stablecoins actually partially solved the problem of volatility in the crypto market. The emergence of new stablecoins and the development of Ethereum can really create a positive change in the industry. The ability to link the real value of assets helps to create stability and facilitate more favorable for the use of cryptocurrencies in daily transactions.

However, there is no denying Bitcoin's important role in changing the way we understand finance and manage wealth. The decentralization and self-control of users for Bitcoin are really strong points, creating safety and freedom in managing personal assets.

Seeing that they have been forced to stop services for UK citizens means low income patronize from customers and this stablecoin PYUSD is just what they are trying to implement to have their daily bread from customers, nothing new under the sun, just the same bullshit but different ecosystem, they are not a trading platform to begin with, when they issued the stablecoin, they will have to collaborate with trading exchanges to increase the adoption for people to use, they are nothing but another baby USDT looking for market shares and the revenue distribution from the already dominated companies (such as USDT, USDC, BUSD, [XUSD or USDX X= to the company name])
hero member
Activity: 2408
Merit: 584
I have not used PayPal however with the feedbacks I have read on social media platforms, they do not seem to be in the good light of the public due to their terms of service, of fining customers $2500 for saying things that they do not agree with. They deducted this money from their bank account. Some old customers are saying if they did this to them and so why should they trust them with their newly launched stablecoin? Well, as much as this sounds good, I think that the US regulators may in the future come for them just as they did with UDSC and Binance USD because they don't want on-shore stable coin.
Their stablecoin is too centralized as they can freeze a user's assets anytime from anywhere if they want, and I don't see that being anywhere near trustworthy. I would never use a stablecoin that be frozen in my wallet without any reason but just because the creators want to do it maybe because I said something that they didn't like or anything like that. It is much better to stick to the current stablecoins instead of accepting a CBDC wearing a stablecoin-shaped face mask.

Those who would use the stablecoin launched by PayPal will simply be using a CBDC that is totally under the control of the organization and probably also the authorities, it shouldn't be considered a cryptocurrency and people shouldn't trust it just like other stablecoins or cryptocurrencies that are highly centralized.
legendary
Activity: 2436
Merit: 1366
I can understand why many of our crypto loving fellas dislike stablecoins. They pull demand towards themselves so making markets less relied to Bitcoin. But stablecoins are solving many problems people have. For example I sometimes do good trade and wanna relax turning back to usd for a week. In past I should have paid too much money to convert back to real usd. But now its easy. I honestly liked if PayPal is planning to make their stablecoin big. I would use it.
full member
Activity: 944
Merit: 101
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Stablecoins actually partially solved the problem of volatility in the crypto market. The emergence of new stablecoins and the development of Ethereum can really create a positive change in the industry. The ability to link the real value of assets helps to create stability and facilitate more favorable for the use of cryptocurrencies in daily transactions.

However, there is no denying Bitcoin's important role in changing the way we understand finance and manage wealth. The decentralization and self-control of users for Bitcoin are really strong points, creating safety and freedom in managing personal assets.
newbie
Activity: 18
Merit: 0

PayPal do have issues that makes one not to find their services interesting. Something like ,there is a lack of good customer service if you encounter a problem with a payment, It is difficult to find contact phone numbers on its website, and emails are usually responded to with automated replies rather than the genuine advice.
Makes the whole thing tiring..
legendary
Activity: 3318
Merit: 1128
This will not end that well for us. There are two options and both of them end up being something terrible for us. If it's liked by a lot of people and used, then they are using a centralized stablecoin and that's a bad thing as well, and if we are talking about being disliked then we are talking about people who dislike a stablecoin and not really doing all that well for the market neither.

This should be very important difference, I do not think that this will end well for us. In the end it happened and unless it's removed and destroyed, it will be staying. So, there is no point of us staying too much on why this is a bad thing and try to make sure that the crypto world is not disturbed by any of this and does well enough.
hero member
Activity: 924
Merit: 550
paypal is increasingly trying to make a profit, by releasing their own stable coin, I doubt this will go well because it's not easy to do this, besides that I also had a bad time with paypal before (frozen account) them surely it will be easy to do this on their token, there is no guarantee that it is safe to use a paypal token.

What is PayPal doing that is new to investors, they are just another centralized people trying to make some money since they know that there is profits that can be generated from crypto investors. Haven't you notice that there is no innovation this companies brings to crypto, they just repackage and sell similar thing just to make more money from people and it's clearly that thats what they want because that is their motto right from the traditional PayPal transactions they have been offering before they decided to give attention to the crypto figures.

It's good step by the way but if they have allowed or integrated bitcoin lightening network, would have been better that people will believe them that they are bringing adoption to crypto but this, no. They just want the share of their national profits in crypto and they will make more if bull run start as some people will want to convert their PayPal balance to Pusd to buy any coin of their desire.
sr. member
Activity: 1022
Merit: 368
Finally, Grin something that can beat USDT is unleashed in crypto world, many aren't going to be happy about this, and that includes the Tether guys, I think many funds will leave USDT at this point and swim into Paypal new stable coin.

Just as I thought, the competition is on. It's going to be PayPal vs USDT vs the banks. A nice move by PayPal. What will be the next move for USDT? Hoping to see the PayPal stablecoin listed on major exchanges as well.

Quote
It looks like a good news, this could be the bridge between biggest payment systems in the world and crypto space at last, I had this dream in 2019 but it failed, lets hope this one will kick off well.
PayPal customers can now easily buy Bitcoin and perform other crypto transactions without leaving the app. This offers an additional advantage for Bitcoin awareness and adoption, as there could be a spill-over effect from this.

full member
Activity: 406
Merit: 188
PayPal takes too long to adapt with the financial market, they finally join the crypto world when the market is already too crowded. Paypal should have taken action when USDT went mainstream, the only thing paypal could compete is on Stablecoin and today the there are a lot of stablecoin. I doubt people will move from USDT to PYUSD.

PayPal has been very slow to enter the market, but anything can happen in this market. So I think anything that is trustworthy should be in the market, and if PayPal can provide that trust in the market, then the stablecoin will not harm the market.

Like you, I doubt that people will switch from USDT to PYUSD, but there should always be alternatives.
sr. member
Activity: 1400
Merit: 268
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PayPal takes too long to adapt with the financial market, they finally join the crypto world when the market is already too crowded. Paypal should have taken action when USDT went mainstream, the only thing paypal could compete is on Stablecoin and today the there are a lot of stablecoin. I doubt people will move from USDT to PYUSD.
hero member
Activity: 2338
Merit: 757
Also, the question comes to my mind, why did they chose the erc20 option on Ethereum
I also have similar question since newer Ethereum standard for token such as ERC-777 and ERC-1155 exists.
There is no logical explanation other than that Paypal did not find what it was looking for on the rest of the networks. And most likely, they may be looking for smart contract technology with options that allow complete control over the currency that will be minted. And I mean here, for example, that feature that allows the development team to freeze any balance of that currency at any address, as this happens with usdt on the same Erc20 network.
I am waiting for one of the developers to verify the smart contract code and tell us the advantages and limitations of this new currency. Personally, I do not think that this currency is better than the rest of the stable coins in the crypto market, whether it is on the Ethereum network or any of the other networks.
legendary
Activity: 3052
Merit: 1273
This is undoubtedly a great move as, according to my knowledge, this may now allow/prevent PayPal's users from becoming a victim of hefty fees that they used to pay to PayPal for each of their transactions and will also bring in more exposure to crypto as PayPal is a huge name whenever we talk about e-currency platforms (most of others were either closed or seized). I also hope that PayPal will not levy their 21 days holding policy on this stablecoin.
full member
Activity: 882
Merit: 207
It is good news for them and all the customers who use the PayPal service. I for one tried using their service some time back to fulfil payment option for Amazon, but didn't get approved. It is a solution to many businesses across border, and their adoption of the USD to back their asset is necessary. but why the USD?
They would do little to convince people due to  past service delivery and customer base.
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