PayPal Enables US Users to Power International Transfers with PayPal USD Stablecoin

PayPal expands its global money transfer services by enabling all U.S. users (excluding Hawaii) to fund transfers using U.S. dollars converted from PayPal's stablecoin, PayPal USD (PYUSD), via its Xoom service. This move allows seamless and fee-free cross-border money transfers to over 160 countries, further enhancing the accessibility and convenience of international payments for PayPal users.

PayPal Enables U.S. Users to Fund International Money Transfers with PayPal USD Stablecoin

New York, April 4, 2023 - PayPal, a global leader in digital payments, announced today that it is expanding its cross-border money transfer services to allow all eligible U.S. users outside the state of Hawaii to utilize its native stablecoin, PayPal USD (PYUSD), as a funding source. This latest development leverages the capabilities of PayPal's Xoom platform and is designed to enhance the accessibility and affordability of international money transfers.

Through Xoom, PayPal users in over 160 countries can now conveniently send funds to family and friends abroad using PYUSD, a U.S. dollar-pegged stablecoin issued and custodied by Paxos Trust Company in New York. The use of PYUSD eliminates the need to convert traditional fiat currencies into cryptocurrency, thereby reducing transaction costs and complexities.

"By introducing the option to fund cross-border money transfers with USD converted from PYUSD, Xoom now offers an easy and reliable way for U.S. users to send money abroad using PYUSD as a funding source," said PayPal.

"When this option is selected, Xoom will convert the PYUSD in a U.S. user's PayPal Cryptocurrency Hub to USD currency with no crypto sale fee, and recipients will receive funds in the fiat currency selected by the sender."

The expansion of this service allows U.S. users to send funds internationally through various methods, including transfers to a recipient's bank account, mobile wallet address, or financial institution for pickup. While transactions denominated in U.S. dollars will not incur additional currency conversion fees, those denominated in other currencies will be subject to a spread.

It is important to note that the use of PayPal USD as a funding source is currently prohibited in Hawaii due to state regulations governing the holding of cryptocurrencies.

PayPal's venture into stablecoin usage reflects the growing adoption of this technology in the financial sector. Since its launch in August 2022, close to $200 million PYUSD has been issued, indicating a nascent but promising appetite for PayPal's stablecoin.

"Our goals surrounding PYUSD are to create a stable value to maximize user confidence and ensure it had utility for commerce and payments," said Jose Fernandez da Ponte, Senior Vice President of PayPal's Digital Currency Group.

The news of PayPal's expanded stablecoin usage comes on the heels of recent announcements from other major players in the digital asset space. Ripple recently announced its plans to launch a U.S. dollar-backed stablecoin, while Nick van Eck, son of investment management maestro Jan van Eck, is set to launch a new U.S. dollar-backed stablecoin after securing $12 million in funding.

As the stablecoin market continues to evolve and mature, PayPal's latest move signals its commitment to providing innovative and cost-effective solutions for international money transfers. By leveraging its existing platform and customer base, PayPal is well-positioned to capitalize on the growing demand for stablecoin-based financial services.