PayPal Establishes a Crypto and Blockchain Advisory Council

When PayPal announced that it would begin the process of launching a stablecoin, questions were raised even despite the massive excitement that swept across the crypto industry.

PayPal Establishes a Crypto and Blockchain Advisory Council

Now, the company is looking to put some of these questions to bed with its dedicated team of advisors. If anything, this goes a long way to show its seriousness to the cause.

Taking Sage Advice From The Masters

Earlier this month, PayPal announced that it had formed a team of crypto and blockchain industry experts to advise how best to pursue its coming stablecoin. The team - known as PayPal’s Blockchain, Crypto, and Digital Currencies Advisory Council - will work with PayPal on its current and future crypto products and advise how best to create an open and inclusive financial system.

As PayPal’s announcement shares, the company’s new advisory group will feature Peter Briger; the co-chief executive at Fortress Investment Group; Neha Narula, the Digital Currency Initiative Director at the Massachusetts Institute of Technology (MIT), former Commodity Futures Trading Commission chair Timothy Massad, Weizmann Institute of Science professor Shafi Goldwasser, and more.

PayPal’s statement revealed that the company is investing heavily in relating with industry experts and thought leaders on how best to solve some of the biggest challenges facing the payments space. All advisers on the group have extensive experience in blockchain and crypto - either from a business, research, or regulatory perspective.

Briger, who appears to be the group’s foremost member, is credited with advising SoftBank Group CEO Masayoshi Son to make crypto investments before 2017’s bull run, earning the billionaire an impressive return. Neha Narula, who leads the MIT Digital Currency Initiative, will also be a member of the team. She has anchored an initiative sponsored by her institute to help the Federal Reserve Bank of Boston design a consumer-facing central bank digital currency (CBDC).

Designing a Stablecoin That Works For Payments

The crypto advisory board is PayPal’s latest foray into crypto, kicking off with the company’s announcement of an upcoming asset. Jose Fernandez da Ponte, PayPal’s senior vice president of crypto and digital currencies, told Bloomberg earlier this year that the company is looking to launch PayPal Coin - a dollar-backed stablecoin that will make it easier for customers to make cross-border transactions.

PayPal’s decision to launch a stablecoin stems from the com[pany’s willingness to improve the global payment infrastructure. Speaking on a podcast episode back in November, da Ponte claimed that PayPal has yet to find a stablecoin designed to support payments specifically. As he explained, a stablecoin should be able to support easy payments and their scaling while also optimizing network security. At the same time, regulatory clarity will be required if such an asset is to operate and reach its potential.

There is no doubt that PayPal’s planned stablecoin will be a hit. Arguably the world’s largest online payments processor, PayPal already has about 350 million customers. The company allows customers in the United States and Britain to purchase and sell Bitcoin, Ether, Litecoin, and Bitcoin Cash. They can also make payments using these coins.

Stablecoins were built to be pegged to the values of specific assets, but most people use them to navigate the crypto market’s inherent volatility - not necessarily for processing payments. This distinction is where PayPal hopes that its stablecoin can come in.

It’s The Right Time For PayPal Coin

It is also worth noting that PayPal is looking to work with regulators to ensure the safe launch of its coin. da Ponte has repeatedly expressed the importance of regulatory clarity and control when cryptocurrencies are concerned. PayPal toeing this line should help the company avoid the wrath of agencies like the Securities and Exchange Commission (SEC).

With Facebook recently shutting down its Diem stablecoin project, PayPal will want to ensure that its PayPal Coin doesn’t suffer the same fate.

There’s also quite a lot riding on the success of this stablecoin project. If PayPal succeeds in building an asset that optimizes payments, the company could spur other traditional payment companies to explore blockchain as well. And, its regulatory compliance will help to clear stablecoins from some of the issues they’ve had in the past due to compliance issues faced by companies like Tether Limited.

It also seems that PayPal is looking to preserve its place among payment services. Platforms like Apple Pay and Google Pay are already opening up to crypto, and there’s a sense that this trend could continue. PayPal having a dedicated stablecoin will only help solidify its place as a leader among global payment processors and hopefully help it retain its customers in the midst of growing competition.

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