PayPal launched a U.S. dollar stablecoin on Monday, aiming to facilitate the adoption of digital currencies for payments and transfers. The stablecoin, known as PayPal USD, is backed by U.S. dollar deposits and short-term U.S Treasuries, and is issued by Paxos Trust Co. PayPalâs shares rose 1.4% to $63.66.
Stablecoins are cryptocurrencies designed to be protected from the wild volatility that makes it difficult to use digital assets for payments or as a store of value. PayPal USD is pegged to the dollar and will gradually be available to the companyâs customers in the United States.
Last month, a U.S. congressional committee failed to reach an agreement on a bill to establish a federal regulatory framework for stablecoins.
