Tether’s Chief Technology Officer, Paolo Ardoino, has expressed his views on the potential impact of PayPal’s recently introduced stablecoin, PYUSD, on the competitive landscape of USDT in the United States.
In an exclusive conversation with Benzinga, Ardoino clarified that he doesn’t perceive PYUSD as a direct rival to Tether’s USDT. Instead, he regards it as a formidable challenge to stablecoin competitors such as Circle’s USD Coin (USDC).
Ardoino emphasized that PYUSD could pose challenges for US-centric stablecoins like USDC, which heavily rely on the American market. In contrast, Tether has predominantly targeted emerging markets outside the US.
He elaborated, “The emergence of another stablecoin within the US is intriguing. It has the potential to impact revenues associated with transactions that have historically fueled entities like MasterCard and Visa. Concurrently, this development could drive industry growth and contribute to the formulation of well-balanced regulatory frameworks.”
Ardoino continued, suggesting that the entrance of PYUSD might further weaken Tether’s competition, especially the competition that predominantly operates within the US market.
PayPal recently introduced PYUSD, a stablecoin that is fully backed by US dollar deposits, short-term US treasuries, and similar cash equivalents. This innovative digital asset can be seamlessly redeemed at a 1:1 ratio for US dollars. The issuance of PYUSD is facilitated by Paxos, a prominent crypto firm, according to an official blog post by PayPal.
The primary objective of PayPal USD is to streamline transactions within virtual environments, facilitating swift transfers of value for various purposes including peer-to-peer payments, remittances, international transactions, and direct contributions to developers and content creators. This initiative aims to encourage the broader adoption of digital assets by globally recognized brands.
Although the majority of current stablecoin usage is within web3 ecosystems, PayPal USD is designed to be compatible with this environment from its inception and is slated to be accessible through Venmo in the near future.
Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.