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PayPal is trying to drag its 435 million users into the $120 billion stablecoin market — here’s why



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PayPal on Monday became the first major U.S. fintech company to offer its own crypto token with a dollar-pegged stablecoin known as PayPal USD, making big promises of how it can move money between millions of crypto investors. The company is entering an extremely crowded market already dominated by stablecoins like tether and USDC, at a time when the hype over cryptocurrency has largely fizzled and prices have been mostly stable with no big run-ups since 2022. But the company’s chief crypto exec tells CNBC that the payment processor is confident in its timing – and its competitive advantage in the space.”Stablecoins are the killer application for blockchains right now,” said Jose Fernandez da Ponte, PayPal’s senior vice president and general manager of blockchain, crypto, and digital currencies. “There are inherent advantages in cost, programmability, settlement time,” continued da Ponte, adding that the market is primed for new entrants that are fully backed – and unlike tether, fully regulated. “Stablecoins are something that we cannot just sit out,” da Ponte added.Da Ponte denied a Bloomberg report that the payments processor paused development of its stablecoin in February. At the time, both the SEC and New York’s financial regulator, NYDFS, were putting pressure on Paxos Trust, a New York-based crypto financial services firm helping PayPal issue its stablecoin. Regulators wanted the firm to discontinue its relationship with Binance. Paxos ultimately stopped issuing Binance’s own dollar-pegged token, dubbed BUSD.The launch comes after crypto liquidity plummeted in the last year and a half.In March, two of the bank …

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