On August 7, 2023, the largest payment system PayPal launched its own stablecoin PayPal USD (PYUSD).
Is PayPal USD stablecoin a threat to Tether?
Members of the crypto community drew attention to the problems of the financial instrument, which made potential users doubt its effectiveness.
MarketsXplora decided to find out if the PayPal stablecoin is really as bad as critics say it is. To do this, we asked experienced experts to share their assessment of the coin and give a forecast of its survival.
Is PayPal USD stablecoin a threat to Tether?
MarketsXplora analyst Stephen Ethan believes that PayPal USD will not be able to take a leading position in the dollar stablecoin market. He explained his point of view by the fact that the token works on the Ethereum blockchain, which allows you to predict high commissions for transfers in PYUSD.
In his opinion, the “stable coin” of the payment system will be in demand only among PayPal users. At the same time, Ethan showed no doubts about the viability of the instrument.
We began our assessment of PayPal stablecoin by observing the demand for such instruments in the US in general. Ethan argues that the most popular “stablecoin” – Tether (USDT) – is not popular in America.
The reason is the opacity of the tool. At the same time, the fully regulated stablecoin USD Coin (USDC), according to his observations, is held in high esteem by Americans.
Note that this alignment of forces does not prevent Tether from holding first place in the ranking of the most capitalized stablecoins.
![Does PayPal USD Stablecoin Pose a Threat to Tether?](https://marketsxplora.com/wp-content/uploads/2023/08/Does-PayPal-USD-Stablecoin-Pose-a-Threat-to-Tether.png)
Certainly, the launch of PayPal’s stablecoin, PYUSD, is a milestone for the industry on its way to mainstream adoption, as Paypal is one of the largest companies in the US traditional finance market. However, I believe that this will have little effect on the balance of power in the segment of stablecoins pegged to the US dollar. Most likely, only PayPal users will be able to appreciate PYUSD so far, Stephen Ethan concluded.
A step towards the legalization of stablecoins
Bitget CEO Gracie Chen, in turn, was more positive about the launch of the PayPal stablecoin. In her opinion, market participants should not doubt the viability of the instrument. She sees the launch of PayPal’s stablecoin as signal for greater transparency in US digital currency regulation.
Recall that the US Congress saw a threat in the launch of the stablecoin. Congressmen drew attention to the lack of tools for the full regulation of the financial instrument. It is likely that the launch of PYUSD will help accelerate the process of forming a legal framework for stablecoins in the United States.
Related: How to Buy PYUSD Stablecoin on PayPal – A Simple Guide for Beginners
Gracie Chen paid particular attention to the possibility of converting cryptocurrencies into PayPal stablecoin. In her opinion, such functionality makes the payment platform “an excellent gateway for deposits in fiat currencies.” Also, the launch of a financial instrument will increase the convenience of cryptocurrency transactions.
Back to the original blockchain concept
Nikolai Zhuravlev, CEO of CFA.RF, also joined the discussion of the PayPal stablecoin. He noted that the Tether team does not see a competitor in PayPal. The main rival of PYUSD, according to the expert, maybe a more regulated USDC. According to our interlocutor, PayPal stablecoin is quite viable. He sees it as a tool for securing cryptocurrencies in the legal field.
I think PYUSD has the potential to really be a major catalyst for stablecoin adoption, with PayPal having a dominant share of the online payment market and huge influence. If the token manages to prove its expediency, its usefulness will become undeniable and the course of the discussion will change for the better for cryptocurrencies, said Nikolai Zhuravlev.
![Does PayPal USD Stablecoin Pose a Threat to Tether](https://marketsxplora.com/wp-content/uploads/2023/08/Does-PayPal-USD-Stablecoin-Pose-a-Threat-to-Tether-1.png)
According to our review, PYUSD is returning to the original concept of the blockchain: the ability of a person anywhere in the world to send money to another person without having to trust or pay fees to banks.
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Meet Samson Ononeme, a dynamic writer, editor, and CEO of marketsxplora.com. With a passion for words and a sharp business acumen, he captivates readers with captivating storytelling and delivers insightful market analysis.