PayPal has introduced its native stablecoin PYUSD for cross-border money transfers with zero transaction fees through its money transfer platform Xoom. US users will be able to utilize this feature starting April 4, allowing them to convert PYUSD to USD to fund transactions to recipients in 160 countries globally. This new offering aims to increase user confidence by providing a stable value for transactions, promoting mainstream adoption of cryptocurrencies, and offering a cost-effective way to send money securely to friends and family.
To use the PYUSD stablecoin for transactions, Xoom will convert the stablecoin to USD currency without any crypto sale fees when a US user selects the stablecoin option. Recipients will receive funds in the fiat currency chosen by the sender to ensure a smooth transaction process. For transactions not completed in USD, a transaction exchange rate will apply. Last year, Xoom partnered with Visa Direct, enabling US users to send money directly to debit card holders, providing a convenient way to transfer funds.
Compared to traditional international remittances, cryptocurrency transactions are more cost-effective due to the absence of middlemen and related fees. Cryptocurrencies like Bitcoin and Ripple have emerged as disruptive forces, offering numerous advantages over conventional payment methods. According to a report by the Bank of International Settlements (BIS) on stablecoins in cross-border payments, these digital assets have shown promise in addressing the challenges faced by traditional payment systems. Stablecoins, being pegged to a stable asset, offer a reliable means of exchange by maintaining a relatively steady value.
Jose Fernandez da Ponte, PayPal’s crypto senior vice president, highlighted the importance of creating a stable value for increased user confidence while emphasizing the utility of cryptocurrencies in commerce and payments. By enabling US users of Xoom to fund cross-border money transfers using PYUSD, PayPal aims to drive mainstream adoption of cryptocurrencies and provide a secure, cost-effective way to send money globally. The introduction of PYUSD for cross-border transactions aligns with PayPal’s commitment to innovation and financial inclusion, offering users a convenient and affordable solution for international money transfers.
The ability to use PYUSD for cross-border money transfers without transaction fees represents a significant step in advancing the adoption of cryptocurrencies for mainstream financial transactions. By leveraging the benefits of stablecoins, PayPal aims to provide a reliable and efficient alternative for users seeking to send money internationally. The partnership between Xoom and Visa Direct further enhances the accessibility and convenience of the platform, enabling US users to transfer funds directly to debit card holders with ease. With the increasing popularity and acceptance of cryptocurrencies, the introduction of PYUSD for cross-border transactions underscores PayPal’s commitment to supporting the evolution of digital payments and enhancing user experiences.
