PayPal, the payment giant, has announced that its customers in the US can now use its stablecoin to fund international payments. The company’s virtual token, PayPal USD (PYUSD), runs on Ethereum and is a dollar-pegged stablecoin backed by cash equivalents and short-term treasuries. Paxos Trust Co. issued the token, and PayPal launched it last year.
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PYUSD’s market cap is currently at $109 million, making it smaller than other stablecoins such as Tether’s USDT, which has a market cap of $106 billion. Customers can now convert PYUSD to dollars and then send money to recipients in approximately 160 countries via PayPal’s Xoom payment platform, with no fees.
PayPal’s SVP of the blockchain, cryptocurrency, and digital currency group, Jose Fernandez da Ponte, said that the move “builds on our goal of driving mainstream adoption of cryptocurrencies.” The stablecoin was launched last year with the hope of it being “a part of the overall payments infrastructure.”
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A stablecoin is a digital asset pegged to something stable, in this case, the US dollar. Such tokens are used by people to exit transactions when they don’t immediately have access to fiat currencies held in a traditional bank, speeding up the trading experience. PayPal allows its users to buy and sell cryptocurrencies on its platform, including Bitcoin and Ethereum, and transfer them to external wallets.