TL; DR
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The crypto space is quickly becoming faster, cheaper and easier to access (globally) than PayPal’s existing closed ecosystem, so they’re adopting it before it kills them.
Full story
In today’s news: ‘If you can’t beat ’em, join ’em’:
PayPal just launched its PYUSD stablecoin on Solana (after launching on Ethereum last August).
“Okay, same stablecoin, new chain. Who cares?”
Good point.
What excites us about this is that it is the writing on the proverbial wall.
PayPal is a closed payments ecosystem that makes its money by collecting fees for trading fiat currencies – and now they’re partially moving into crypto – a place where:
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They do not own the underlying ecosystem (instead, Ethereum and Solana are user-owned).
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They do not collect fees for PYUSD transactions made outside of the PayPal app.
…so why would they give that up?
The crypto space is a growing ecosystem that is quickly becoming faster, cheaper and easier to access (globally) than their existing closed ecosystem.
So PayPal must adapt or die.
Right. But how do they make money?
If they are like other stablecoins, they take a small portion of the total cash balance of their stablecoins and put it into short-term investments that are easy to finance in order to make a profit.
Boring topic, exciting consequences!