Global payment giant #PayPal launches PayPalUSD (PYUSD) USD-backed stablecoin in a regulatory turning point for the crypto market.
What is PYUSD?
PayPalUSD (PYUSD) is a PayPal's stablecoin. PYUSD is an ERC-20 token issued on the Ethereum blockchain by #Paxos Trust Company, offering experiences within the PayPal ecosystem. PYUSD can easily be adopted by exchanges and will soon be available on Venmo, aligning with wallets and #Web3 applications.
Designed to minimize friction for digital payments, facilitate domestic and international transfers, and foster direct transactions for developers and creators, PayPalUSD is aimed at encouraging major brands worldwide to participate in the digital asset market.
PYUSD applications
U.S. PayPal customers can buy and sell PYUSD, move between PayPal and compatible external wallets, make purchases with PYUSD, and convert supported cryptocurrencies to and from PYUSD. Users can buy, sell, hold, and transfer PayPalUSD within the PayPal app or website, sending and receiving funds to friends in the U.S. without fees. Being Ethereum-based, customers can easily send PayPalUSD to #Ethereum wallet addresses accepting PYUSD with just a few simple steps.
When purchasing or selling cryptocurrencies, including crypto payments, the platform will disclose conversion rates and associated fees for the transaction.
PYUSD usage and availability
PYUSD is issued in collaboration between PayPal and Paxos. Currently, PYUSD is only available in the United States. PayPal has indicated potential deployment for customers in other countries in the future.
Some users might receive a "We're not available in your area yet" error message when attempting to buy, sell, or hold #PYUSD on PayPal.
Innovative safeguards, regulatory compliance, and its integration into PayPal's ecosystem position PYUSD as a significant player in the stablecoin market.
PYUSD special features
A distinguishing feature of PYUSD sets it apart from its competitors and has garnered support and expectations from experts in the market.
PayPal's choice of Paxos as the issuing partner is based on Paxos' status as a chartered trust company regulated by the New York Department of Financial Services (NYDFS). Paxos' supervisory agency monitors all activities related to the issuance, including reserve management. All holders of PYUSD are protected under the supervision and regulations set by New York.
These rules focus on eliminating bankruptcy risks. Customer assets are safeguarded even in the event of Paxos' bankruptcy – a situation increasingly relevant in today's cryptocurrency market. NYDFS intervenes, and PYUSD remains unaffected. This approach ensures that customers do not become creditors, and funds are returned to the owners.