PayPal Holdings Inc. recently confirmed that the company is currently considering developing and launching a stablecoin. This confirmation came after a developer uncovered some references within PayPal’s iOS app to something called the “PayPal Coin.”
For the unfamiliar, a stablecoin is a form of cryptocurrency pinned to a stable reserve asset. Some excellent examples would be the dollar or gold. The benefit of a pegged coin is that its price is more or less stable. Not only that, its volatility is drastically reduced, unlike the other cryptocurrencies. These days, stablecoins have become more popular, thanks to their ability to allow transfers between exchanges and for everyday commerce.
Last Friday, senior vice president of crypto and digital currencies at PayPal Jose Fernandez da Ponte told Bloomberg that the company is looking into a stablecoin at this time. If or when they decide to push through and launch it, Ponte ensures that they will be working closely “with relevant regulators.”
As for the PayPal Coin code discovered by Steve Moser, PayPal confirms that it’s in no way related to their ongoing stablecoin plans. Rather, the company reveals that the code came from an internal hackathon, where PayPal engineers brainstormed and developed brand-new potential products that may never see the light of day. In other words, if the PayPal stablecoin is eventually launched to the public, it could have a different name, logo, and other features altogether.
PayPal first joined the crypto scene back in October 2020 when it released a service that allows users to buy, hold, and sell crypto directly from their PayPal accounts. The service was initially launched in the United States with support for popular assets like bitcoin, Ethereum, Bitcoin Cash, and Litecoin. They later expanded the service to the United Kingdom in August.
At the time, PayPal president and chief executive officer Dan Schulman said:
That said, PayPal’s path towards developing and launching a stablecoin may not be an easy one should they move forward with their plans. Meta Platforms Inc. has had plans to release its own stablecoin for a couple of years now. It was originally named Libra but was later changed to Novi.
However, it seems Meta’s attempts at a stablecoin only brought in controversy and regulatory obstacles. While we believe that PayPal’s stablecoin won’t be as controversial, but there’s still a good chance that it will encounter some regulatory issues.
