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 “If you can’t beat ‘em, join ‘em” news:
PayPal just launched their PYUSD stablecoin on Solana (after launching on Ethereum last August).
“Ok, same stablecoin, new chain. Who cares?”
Fair point.
What’s exciting us about this is the writing it puts on the proverbial wall.
PayPal is a closed payments ecosystem, that earns its money by taking fees from the trade of fiat currencies — and now they’re partially transitioning to crypto — a place where:
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They don’t own the underlying ecosystem (instead, Ethereum and Solana are user owned).
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They don’t collect any fees on PYUSD trades 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 needs to adapt or die.
Right. But how do they make money?
If they’re anything like other stablecoins, they’ll take a small portion of their stablecoin’s total cash balance, and put it in short term, easy-to-get-out-of investments in order to eek out a profit.
Boring subject, exciting implications!
