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.