[eMarketer] PayPal mulls proprietary stablecoin to help drive platform growth

PayPal confirmed that it's exploring a stablecoin backed by the US dollar after developer Steve Moser discovered code and images referencing “PayPal Coin” inside the PayPal iPhone app, per Bloomberg.

Stablecoins are generally less volatile than traditional cryptocurrencies like Bitcoin or Ethereum. They’re pegged to the value of an underlying currency or commodity, like the US dollar or gold—making them more viable for payments.

eMarketer argues that one drawback for stablecoins is the lack of adoption and acceptance as payments. But a PayPal stablecoin might be able to overcome this hurdle thanks to the brand’s vast merchant and customer bases.

A proprietary stablecoin would be the cherry on top of PayPal’s crypto-related efforts.

Since PayPal began letting US users buy, sell, and hold cryptos through its app in November 2020, it’s launched several payment-adjacent crypto solutions. It rolled out Checkout with Crypto, introduced Cash Back to Crypto for Venmo credit card users, and also brought its crypto exchange to the UK.

The potential stablecoin could be used alongside Bitcoin to make purchases through Checkout with Crypto and could be purchased on PayPal’s exchange to help drive volume—though the latter’s viability will depend on establishing consumer interest and adoption. PayPal could also let users make peer-to-peer payments with the currency through its app or via Venmo.

Read the full eMarketer article here

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