PayPal explores creating its own stablecoin

A stablecoin could be the next step in PayPal's crypto drive.

PayPal explores creating its own stablecoin

A stablecoin could be the next step in PayPal's crypto drive, the company said after evidence of the move was discovered in its iPhone app.

Jose Fernandez da Ponte, senior vice president of crypto and digital currencies at PayPal, said in a statement to Bloomberg News that the company is exploring a stablecoin. Should we choose to proceed, we will, of course, consult with relevant regulators.

Stablecoins are crypto assets that are backed by the value of a commodity or currency.

Bloomberg first learned about PayPal's attempts to build a stablecoin in its app created by developer Steve Moser. Images and hidden code revealed work on a coin dubbed the "PayPal Coin." The code suggests it would have a dollar backing.

PayPal's blockchain, crypto, and digital currencies division said the images and code inside the PayPal app stemmed from a recent internal hackathon that encouraged engineers to explore and build new products.

This means that the final product may have a different name, logo, and feature set.

In recent months, PayPal has taken a major step into the cryptocurrency space, offering new features for buying and holding digital coins as well as the ability to pay for purchases using them.

During the Unchained podcast, Fernandez da Ponte said recently that PayPal hadn't seen a stablecoin that was designed specifically for payments. "To be useful to PayPal, a stablecoin had to support payments at scale and be highly secure," he said.

Da Ponte continued to say that regulation, regulatory frameworks, and the type of licenses required in this field would need to be clarified.

PayPal isn't the first tech giant to consider creating its own cryptocurrency. A stablecoin backed by the U.S. dollar has been accepted by Visa Inc., formerly Facebook, in recent months, while Meta Platforms Inc., formerly Facebook, has developed Diem.