US payments company PayPal considers issuing its own stablecoin

PayPal has met with developers of stablecoin protocols in the cryptocurrency industry, according to four people familiar with the matter, suggesting it will work with third-party firms.

In addition, Ava Labs, which develops the Avalanche blockchain, and PayPal discussed issuing a stablecoin. The names of the companies other than Ava Labs have not been revealed.

When The Block asked PayPal about issuing a stablecoin, the head commented as follows and avoided any content related to stablecoins.

(PayPal) will continue to explore the potential of digital currency and digital financial services infrastructure, and will consider how to contribute to improving digital commerce as a reliable partner in this field.

As a global company working with regulators and industry partners around the world to shape the next generation of the financial system, we often discuss the technologies that enable these goals.

However, rumors and speculation do not predict our future plans.

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In the past, there have been predictions about PayPal’s stablecoin launch.

In October 2020, Meltem Demirors, CSO of Coinshares, a major British cryptocurrency investment company, interviewed CNBC's investment program "Fast Money" and said: "PayPal will be stable in 6 to 12 months."

Demirors noted that PayPal was an early member of the Libra consortium but withdrew in the fall of 2019.

He also said that the cryptocurrency service launched by PayPal in the fall of 2020 is already an "ecosystem within PayPal's own platform," so this could be a way for PayPal to issue its own currency.

PayPal CEO Dan Schulman also spoke at the Forbes event in April about the concept of a system that "delivers more value from basic transactions," such as "introducing smart contracts and transactions that use virtual currencies for payment."

Although he was cautious about holding virtual currencies as corporate assets, he spoke highly of the pros and cons and future potential of CBDC (Central Bank Digital Currency) from the perspective of financial inclusion.

As Avalanche was designated as a partner project candidate in the issuance of PayPal’s stablecoin, the price of the native token “AVAX” rose by about 9% from the previous day.