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PayPal, a long-time player in the cryptocurrency space, is now launching a new token issued by Paxos. Paxos, which has faced scrutiny from US regulators, halted the issuance of BUSD earlier this year. The allegations will be resolved by February of next year, and BUSD will become a thing of the past.
PayPal and Cryptocurrency
The California-based payment company announced today that PayPal USD (PYUSD) is being issued by Paxos Trust Co. and is fully backed by deposits of US dollars, short-term Treasury bonds, and similar cash equivalents. This stablecoin will be made available to US customers and will reduce transfer costs.
Stablecoins are particularly useful for cross-border payments. Traditional transfers can cost tens of dollars and take days to complete. However, stablecoin transfers are instantaneous and have almost zero cost compared to SWIFT transactions.
Paxos came under scrutiny this year due to the investigation into BUSD. The company faced regulatory issues and was forced to halt the issuance of BUSD. As a result, the stablecoin, named by Binance but issued by Paxos, began to rapidly lose market share. In response, Binance listed more alternative stablecoins on its exchange.
The token will be launched on the Ethereum network and will be one of PayPal’s most powerful tools for integration into the Web3 ecosystem.