PayPal, the payments behemoth, is introducing its native stablecoin, PYUSD, to facilitate cost-free international money transfers.
Based on its money transfer platform, Xoom, the Silicon Valley-based startup unveiled the new function on Thursday. The press release states that the service will launch on April 4 for subscribers in the United States.
Users may now convert their PYUSD stablecoin in their connected PayPal account to USD and use it to transfer money to 160 destinations worldwide. It went on to say that Xoom will not charge any fees for transactions financed using the stablecoin.
Crypto senior VP Jose Fernandez da Ponte of PayPal stressed the need to establish a constant value to inspire trust among users. He went on to say how useful it is for things like online shopping and payments.
“Providing Xoom customers in the US with the option to finance international money transfers using PYUSD furthers our mission of increasing the usage of cryptocurrencies in everyday life while simultaneously providing a convenient and inexpensive means of sending money abroad.”
When a US user chooses PYUSD as their stablecoin, Xoom will convert it to USD without imposing a crypto selling charge. Then, to make sure everything goes well on both sides, the receiver will get the money in the fiat currency the sender selected.
Additional information from the statement said that for transactions not settled in USD, a transaction exchange rate is applied.
Users in the United States were able to transfer money directly to debit card holders last year using PayPal’s Xoom service, thanks to a partnership with Visa Direct.
Cryptocurrency transfers are much cheaper than conventional international remittances due to the elimination of intermediaries and associated costs. However, new decentralized digital currencies with several benefits over older ones have recently surfaced, such as Bitcoin and Ripple.
Stablecoins have recently emerged as an attractive alternative to conventional payment systems, according to a study by the Bank of International Settlements (BIS) on the topic of cross-border payments.
According to the paper, stablecoins provide a more trustworthy form of trade than Bitcoin since its value is related to a stable asset.
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