After weeks of rumours about a PayPal project linked to the creation of its own stablecoin, now comes the first confirmation from sources in the American electronic payments company.
PayPal and cryptocurrencies
2021 has been a year in which PayPal has shown a growing interest in cryptocurrencies and related applications.
Last March, it acquired the Israeli startup Curv, which specializes in cryptographic security, for a sum close to $200 million.
At the end of March, the long-awaited Bitcoin payment service arrived, first only for US users, and in November also for the rest of the world.
In both the US and the UK, it is possible to exchange major cryptocurrencies via the app.
It is therefore almost natural that all this interest on the part of the giant of electronic payments in cryptocurrencies could soon lead to a crypto-related project of its own.
The news of this project of a stablecoin pegged to the dollar was reportedly revealed to Bloomberg two days ago by a well-known cryptographic developer Steve Moser, who also mentioned it on his Twitter profile.
— Steve Moser (@SteveMoser) January 7, 2022
The news was also confirmed to Bloomberg by PayPal’s senior vice president for cryptocurrencies and digital currencies Jose Fernandez da Ponte, who said the company was exploring options for creating its own stablecoin.
Da Ponte said:
“We are exploring a stablecoin; if and when we seek to move forward, we will of course work closely with relevant regulators”.
Also speaking to Bloomberg, the Paypal manager also referred to the limitations of currently existing stablecoins, saying:
“I don’t think that we have seen a stablecoin that works well for payments yet”.
Stablecoin instead of cash
According to American economist Eswar Prasad, author of the bestseller “The Future of Money “, which explains how digital innovation is transforming finance and currencies, the Covid-19 would have accelerated the digital revolution in payments as well, and will lead to increasingly cashless payments in the near future.
Cryptocurrencies and especially stablecoins could be, according to the economist, the natural replacements for traditional cash.
“The end of cash is on the horizon and the time has come for an extensive public debate on what takes its place. After all, it will affect not just money but also the economy, finance and society”.
And speaking specifically about cryptocurrencies Prasad is convinced that they are destined to be far from a passing fad:
“Cryptocurrencies surely have opened up a dimension that Central Banks cannot undermine and that’s why Central Bank Digital Currencies may be here sooner than expected. However, one think is for sure, digital currencies are here to stay”.
So in such an environment, it is almost inevitable that companies like PayPal, which make digital payments its core business, will look with increasing interest at digital assets as future payment instruments.