Tech

PayPal is exploring launching its own Cryptocurrency

We saw it coming.

words by: Sahar Khraibani
Feb 10, 2022

Since opening Bitcoin trading to all customers in 2020, PayPal has been developing its cryptocurrency business. It allowed US consumers to pay with cryptocurrencies and raised the amount of cryptocurrency it could buy in 2021. Now, PayPal Holdings Inc. is considering launching its own stablecoin as part of its foray into cryptocurrency.

 

Stablecoins are cryptocurrencies that are backed by the value of an existing currency or commodity, and priced accordingly. According to Jose Fernandez da Ponte, Senior Vice President of crypto and digital currencies, the company is “exploring a stablecoin; if and when we seek to move forward, we will of course, work closely with relevant regulators.”

 

Developer Steve Moser discovered evidence of the company’s efforts to create a stablecoin in PayPal’s app and shared it with Bloomberg. Work on what has been labeled a “PayPal Coin” is visible through hidden code and graphics. According to the code, such a currency would be backed by the United States dollar.

 

A PayPal representative said the graphics and code in the PayPal app came from the company’s blockchain, crypto, and digital currencies division’s recent internal hackathon—an event in which developers collaborate to quickly explore and build innovative technologies that may never see a public release. That implies the final logo, name, and features may change when the product is released to the public.

 

In recent months, PayPal has stepped up its cryptocurrency efforts, introducing new facilities for buying and holding digital tokens, as well as the option to pay for transactions with them — including the acquisition of crypto startup Curv last year.

 

Fernandez da Ponte recently stated on the Unchained podcast that the company has “not yet seen a stablecoin out there that is purpose-built for payments.” A stablecoin would need to allow payments at scale and be secure for PayPal to utilize it, he said.

 

It seems that the migration to digital currencies is unavoidable, providing demonstrable benefits in terms of financial inclusion and access, payments system efficiency, speed, and resilience, and governments’ capacity to promptly disperse monies to individuals.

 

PayPal isn’t the first internet company to consider developing its own cryptocurrency. Diem is a stablecoin developed by Meta Platforms Inc., previously Facebook, and Visa Inc. have permitted a stablecoin, backed by the US dollar, to settle a transaction with the network.

 

To learn more about PayPal’s trajectory with cryptocurrency so far, here’s how its sister company, Venmo, allows you to trade and learn about cryptocurrency now.

 

Photo via PayPal