PayPal Completes Its First Business Transaction Using Stablecoin (bloomberg.com) 20
PayPal completed its first business payment using its proprietary stablecoin as a way to demonstrate how digital currencies can be used to improve often-clunky commercial transactions. From a report: PayPal paid an invoice to Ernst & Young LLP on Sept. 23 using PYUSD, the stablecoin the firm launched last year, relying on an SAP SE platform to complete the transaction. SAP's platform, known as the digital currency hub, allows enterprises to send and receive digital payments instantly, around the clock. The invoice amount wasn't disclosed.
Stablecoins are cryptocurrencies usually designed to track traditional currencies one-to-one. PYUSD, which has a current market capitalization of almost $700 million, tracks the US dollar. While the consumer-facing benefits of stablecoins often dominate conversations, this payment demonstrates other use cases for the digital currency, according to Jose Fernandez da Ponte, PayPal's senior vice president of its blockchain, cryptocurrency and digital currency group.
Stablecoins are cryptocurrencies usually designed to track traditional currencies one-to-one. PYUSD, which has a current market capitalization of almost $700 million, tracks the US dollar. While the consumer-facing benefits of stablecoins often dominate conversations, this payment demonstrates other use cases for the digital currency, according to Jose Fernandez da Ponte, PayPal's senior vice president of its blockchain, cryptocurrency and digital currency group.
if it's one to one (Score:3)
Re: if it's one to one (Score:1)
Essentially, they want to print money. That works bacause "stable"-coins are not actually that stable.
Re: if it's one to one (Score:4)
Thats why.
Re: if it's one to one (Score:3, Informative)
In the US, an ACH transfer through the Fed can take three days (most of which is banks just sitting on the transferred funds to earn their own interest). To do faster, you need to pay an Electronic Payments Network like Fiserv.
PayPal has press releases saying they partner with Fiserv. But thatâ(TM)s still someone else collecting the money for transaction fees. By operating their own stablecoin, they can participate in the processing network (Ethereum & Solana) and receive transaction fees.
Now the
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Do they have something secure enough to protect their wallets' private keys? HSMs are one thing, but AFAIK, there is no HSM rated to protect a key holding a billion dollars worth of money, something so high that nation-states will get involved and try flipping employees. The technology and infrastructure just isn't here to protect extremely high value keys like this.
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In the US, an ACH transfer through the Fed can take three days
Since 2022 you can transfer money up to $1m within the same day using Fast ACH: https://www.nacha.org/resource... [nacha.org] I would argue, that even such large transfers should NOT be instant.
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Services like FedNow and ACH RTP are nearly instantaneous and have a much lower overhead cost than a trip through "stablecoin". The limits are $500,000 for FedNow and $1 million for RTP.
There's always old school "wires" which can have higher limits -- and slightly higher fees (around $15 or less for commercial entities).
Tell me again the value of the stablecoin approach? Other than another intermediary that can take a little bit of the pie.
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Tell me again the value of the stablecoin approach? Other than another intermediary that can take a little bit of the pie.
Easy, PayPal would rather that THEY are the intermediary who takes the little bit of the pie.
Oh, you meant what's the value for the consumer? *shrugs* Why should PayPal care about that?
Stable coins can be as cheap (or cheaper) than ACH (Score:2)
An exchange within the same crypto exchange doesn't require a ledger entry. IIRC, that's how CoinBase does it with their payment service.
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Stablecoins make a lot of money for the maker. For example:
Bob makes his coin, pegged to the dollar, 1:1. He gets ten people to trade a buck for a Bobcoin. He now has $10. He also can mint more Bobcoins, because he knows not everyone is going to want their dollar back, so he can spend 100 Bobcoins, and there is a good chance, not everyone will want to turn their Bobcoins back into dollars. However, if it happens, well, people who bought Bobcoins are screwed. This is exactly like how banks were, where
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All of the the PayPal Mafia platforms and members have become unproductive.
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Every time I see this copy/paste, I have the urge to make a smug post about how BTC will be $100,000 by the end of the year, which will trigger someone mocking Pyrate Pete and links to postings from a few years ago.
However, it would be nice if cryptocurrency just dies. The tulips have wilted. Nobody cares about blockchain anymore. The Lambos have been purchased, and the whales have cashed out, although it is likely some people's 401ks have bought into BTC, which is why it is at ~$60k as of today.
Wish we
Ransomware (Score:2)
Nearly useless (Score:2)
PayPal can retroactively undo your transaction or blacklist you if they don't like you. And they will charge for the service.
Blockchain transfers can be quick and cheap. The only issue is bridging between fiat and stable coins, though if you're transacting entirely in stablecoins, it wouldn't matter.
The current fee (Score:2)