PayPal’s stablecoin expected to succeed where Facebook failed
PayPal is set to launch its own stablecoin, PayPal USD, which is pegged to the U.S. dollar. This move comes after the failure of Facebook’s stablecoin, Libra, due to political opposition and regulatory scrutiny. However, experts believe PayPal is in a better position to succeed because policymakers now have a greater understanding of stablecoins and their regulations. Unlike Facebook, PayPal is an established financial operator in Washington and has been lobbying on cryptocurrencies for several years. Additionally, PayPal’s stablecoin will be issued by Paxos Trust and subject to oversight by the New York State Department of Financial Services. While some policymakers have expressed concerns, the overall reaction in Washington has been muted.
Key Points:
- PayPal is launching PayPal USD, a stablecoin pegged to the U.S. dollar, making it the second major global company to launch a stablecoin after Facebook.
- Policymakers are now more familiar with stablecoins and their regulations compared to 2019.
- PayPal’s established presence in Washington and its lobbying efforts give it an advantage over Facebook.
- PayPal expects its stablecoin to be mainly used by U.S. customers for buying and selling other crypto tokens on its platform.
- While some policymakers have concerns, the overall reaction in Washington has been muted.
Hot Take:
PayPal’s stablecoin is likely to succeed due to its position as an established financial operator in Washington and policymakers’ increased understanding of stablecoins. The company’s successful lobbying efforts and compliance with oversight by the New York State Department of Financial Services also contribute to its advantage. While concerns exist, the overall reaction from policymakers has been relatively calm, indicating a potential path to success for PayPal’s stablecoin.
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