PayPal has announced the launch of a new dollar-backed stablecoin, becoming the first major US financial company to create a stablecoin. The stablecoin, called PayPal USD, will be fully backed by US dollar deposits, US Treasuries, and similar cash equivalents. It will be available to PayPal customers starting Monday, allowing them to purchase, send, convert, and fund purchases in the coming weeks. The stablecoin will be issued on the Ethereum blockchain as an ERC-20 token. Paxos will be responsible for publishing a monthly Reserve Report on the stablecoin. PayPal’s CEO, Dan Schulman, stated that the shift towards digital currencies requires a stable instrument that is both digitally native and easily connected to fiat currency like the US dollar. This move by PayPal showcases the company’s commitment to responsible innovation and compliance.
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