Paypal is considering jumping fully into the crypto hype. The payment provider is looking into launching its own stable crypto currency.
Payment provider Paypal is exploring the possibility of launching its own crypto currency. That would be a so-called stablecoin: a crypto currency tied to the rate of a traditional currency. In this case, that would be the dollar. Such coins are more stable than, say, Bitcoin or Ethereum, since they do not get their value from miners and the volatile investment market. They primarily serve as a practical medium that bridges the gap between real money and cryptocurrency.
Exactly what Paypal hopes to find in the crypto market is unclear. However, the hype surrounding cryptocurrency continues and the payment provider presumably wants to get a piece of the pie. However, because of the link to the dollar, a Paypal currency will never reach the heights of, say, Bitcoin.
Exchange platform
Paypal already allows customers in the U.S. to buy crypto currencies through its own platform. In addition, users can buy things with their crypto-assets. These are then converted to real money. A stablecoin does fit into that picture as a stable intermediate currency for such transactions.
Unlike real money, stablecoin also remains an unregulated affair with which Paypal can actually do what it wants. It basically allows the provider to create additional coins at will. The value of the coin is only maintained as long as Paypal can guarantee conversion to the linked currency and users also believe that its cash reserves are sufficient for that purpose.
Logo but no concrete plans
It’s not there yet. Researchers already discovered a logo for PayPal Coin in the app, but that, according to Paypal itself, is a remnant of a hackathon to explore the potential of its own coin. Whether and when PayPal itself will launch cryptocurrency remains unknown.