Dispatch #152: PayPal Keeps Things Stable

Aug 11, 2023 3 min read

Dispatch

In this patch of your weekly Dispatch:

PayPal’s foray into stableland 🟰
Microsoft 🤝 Aptos
Music vs. NFTs 🤑

The Big Idea

PayPal Enters the Stablecoin Arena

Holding onto your stablecoins, folks? The stablecoin market's set to jump on a “growth flywheel” from a mere $125B to $2.8T in the next five years, says broker Bernstein.

Their research report comes on the heels of PayPal’s entry into the stablecoin realm. This week, the P2P payments giant unveiled PayPal USD (PYUSD) – an Ethereum-based, dollar-pegged stablecoin, to be backed by dollar deposits, T-bills, and cash equivalents.

The Paxos-issued PYUSD will allow eligible U.S. customers to transfer funds between PayPal and external wallets, send P2P payments, and convert to and from other cryptos. Designed to facilitate fast transfers and support various transactional needs, PYUSD wound fit into the web3 ecosystem.

Tl;dr = dollar-pegged cryptos are no longer just for the crypto savvy.

People on crypto X (formerly Twitter) have been making sarcastic comments and criticizing the programming behind PayPal's stablecoin. Commenting on these, Nexo CPO Elitsa Taskova said:

“Hysteria sells, but there’s scant substance to the most excitable claims that have been circulating in the cryptosphere this week. An issuer having the ability to freeze a stablecoin is uninteresting; if critics want to focus on anything, they should be debating PayPal’s willingness to use such a power. Given that PayPal’s record of customer account suspensions is checkered, to put it mildly, it will be interesting to see how willing they are to halt PYUSD transactions.”

PayPal's entry into the stablecoin arena could lead to more people using crypto, especially stablecoins, and might give PayPal a larger piece of the market currently held by other stablecoin leaders. Simply put, stables might be becoming the next big thing, or should we say, 2.8 trillion big things?

The Latest In…

AI + Crypto

In another big one for mainstreamification, Aptos teamed up with Microsoft to foster Web3 adoption in the banking sector, exploring innovations like asset tokenization and on-chain payments. The partnership will also introduce new tools like Aptos Assistant, a ChatGPT-powered chatbot, and “enhance the network's security.” The announcement led to an immediate surge of the APT token. Read more about Aptos in Dispatch #110.

The Latest In…

NFTs > Music?

Who said degen-ing wasn’t a viable career path? Grimes, the singer-songwriter born Claire Boucher, also known as the parent of two kids with Elon Musk, said in a Wired interview she was “sad” about what happened to crypto, referring to some people who tried to make profit as fast as possible. Simultaneously, she admitted that she made more from NFTs than from her music career – last time we checked, in 2021 she banked $6M in an auction. Confused? We are too.

The Latest In…

The Nexo Pod

Will blockchain blur country borders? Our podcast host Magy seeks to answer this question in the second episode of Nexo’s Social Block podcast. Her conversation with Esteban Villegas, CEO & Co-founder of Zulu, addresses blockchain's potential to transcend borders – from getting university degrees verified abroad to tracking international supply chains. Tune in on YouTube, Spotify, or wherever you get your podcasts.

The Week’s Most Interesting Data Story

Bitcoin’s Price as Bart Simpson’s Hair

Bitcoin's current trading pattern is humorously called the "Bart Simpson pattern," referencing the famous character's spiky hair. This pattern, typically seen in shorter timeframes and during low liquidity, includes a sudden price spike, trading close to a particular price, and a sharp movement in the opposite direction. Known as Barts, these price patterns resemble Bart Simpson's hairstyle, with the price oscillating in a tight range after a surge.