PayPal has launched its own dollar stablecoin. We tell you why it is necessary and what it means for the cryptosphere. As well as what prospects the new instrument has on the global financial market

After two years of development and portability, PayPal has launched its own dollar-stablecoin. And actually became one of the first major payment companies that were able to bring their crypto product to the mass market.

The stablecoin from the payment service was named PayPal USD and the stock ticker PYUSD. Its issuer is Paxos and it will be fully backed by dollar deposits, short-term treasuries and similar financial instruments. Its exchange rate is pegged to the U.S. dollar exchange rate. And the company will initially gradually make it available to PayPal customers in the US.

Stablecoin from PayPal will be exchangeable for dollars or other cryptocurrencies available in PayPal wallets. The company will set an exchange rate that includes the service’s commission on each conversion. PayPal USD will also be able to be used to pay for purchases through a wallet in Venmo, a popular payment app from PayPal. In addition, it will be possible to transfer the token to compatible third-party wallets that are not part of the PayPal network. At an early stage, PayPal expects that PYUSD will be used mainly in the cryptocurrency and Web3 sectors, for example, to exchange for other crypto-assets or for payments in blockchain games. Even then, steiblcoin will gradually gain traction in areas such as money transfers and micropayments.

Stablecoin from PayPal has every chance to join the list of the most popular stablecoins in the future.

PayPal itself has a developed infrastructure and is represented in many countries. It greatly facilitates cross-border payments and speeds them up.

PayPal is actively used by freelancers and developers with international customers. Our experts believe that PYUSD will be a convenient way for them to get paid. It is also interesting that PayPal by the readiness of its infrastructure bypasses many central banks that are just trying to develop digital national currencies (CBDC). In other words, we are witnessing the emergence of a corporate currency that has a chance to become a significant player in the currency market, displacing central banks.

PayPal is one of the global payment giants, so we would like to believe that the future of PYUSD is very bright. At least due to the support of 430 million users of the platform.

Pay Pal and cryptocurrencies

PayPal has been supporting transactions with cryptocurrencies for some time now. And allows users to store such of them as Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH) and Litecoin (LTC). In its earnings report for the first quarter of this year, the company said it stores about $1 billion worth of cryptocurrencies for its customers.

Since last year, users have been able to transfer cryptocurrency from PayPal accounts to third-party wallets. The company also invests in blockchain startups. And that includes recently leading a $52 million investment round for Magic. Which provides infrastructure for integrating digital wallets into online services and enterprise projects.

PayPal co-founder Peter Thiel’s Founders Fund venture capital fund began investing in Bitcoin back in early 2014. Shortly before the collapse of the crypto market in the spring of 2022, the fund sold almost all cryptocurrency assets, earning about $1.8 billion.

In 2021, it first became known that PayPal began looking for developers to create its own dollar-stablecoin. Despite regulatory scrutiny, problems over the BUSD issue, Paxos remained PayPal’s launch partner for the steblecoin. The company said the partnership was a milestone for the entire industry.

“PYUSD is a first-of-its-kind currency that represents the next stage in the evolution of the U.S. dollar on blockchain,” Paxos said.

And calling PayPal USD “the world’s most secure dollar-backed digital asset.” On the day of the announcement of the stablecoin, the U.S. House of Representatives issued a press release. And where it says that with proper regulation, stablecoins “could become the basis for a 21st century payment system in the United States.”

The PYUSD stablecoin is not yet available on cryptocurrency exchanges. And to purchase it, you must be verified on PayPal’s website.

The Aave project has launched a GHO token with a peg to the dollar exchange rate. We tell you how it works and how it can help popularize the sphere of decentralized finance

The Aave lending platform eliminates traditional intermediaries such as banks. And the service runs on the Ethereum blockchain and uses software smart contracts to automate lending and borrowing operations. Aave was founded in 2017 by Stani Kulechov, a Finnish entrepreneur with a legal and financial background.

A user-friendly interface and a number of innovative functional solutions have made Aave one of the leading DeFi platforms. The protocol allows users to earn interest on their crypto assets. And by investing them in so-called liquidity pools. From these pools, borrowers get loans. They pay interest on the funds. And that is shared between the lending users and the platform itself. Interest rates depend on market conditions and are set on the basis of supply and demand.

To work with Aave it is enough to have a cryptocurrency wallet with the function of signing transactions, such as MetaMask, and cryptocurrency to deposit into the protocol. Once deposited, there is an immediate opportunity to either lend the funds. And at the same time receiving interest, or to borrow some assets against their collateral. Borrowers have access to many assets, including the cryptocurrencies bitcoin (BTC) and Ethereum (ETH). As well as the largest by capitalization stablecoins – Tether USD (USDT) and USD Coin (USDC). Aave is now entering the territory of the latter, but is taking a slightly different approach.

Stablecoins linked to the dollar exchange rate are some of the most popular assets on Aave and other similar platforms

The most capitalized stablecoins are USDT and USDC, issued by Tether and Circle, respectively. Both coins are managed by centralized organizations. And which maintain reserves for their “stablecoins” in fiat currencies, gold, securities, and other assets. These reserves provide stability to the exchange rate. And the loss of that stability, even short-term, is considered an abnormal event for the market.

However, Aave’s own stablecoin, issued under the ticker GHO, is backed by assets backed on Aave. And is programmed so that its value on the Aave network is always exactly $1. This is another attempt by the crypto market to create less volatile cryptocurrencies that are not dependent on a centralized issuer.

Borrowers often pledge cryptocurrencies on Aave to borrow specifically stablecoins. Due to the lack of exchange rate volatility, they can be more convenient for payments than, for example, the same bitcoin.

There are already several decentralized (algorithmic) stablecoins on the market. The most capitalized of these is Dai (DAI), operated by MakerDAO, a credit DeFi platform that competes with Aave. Like Dai, GHO will not be issued by a single issuer. It will be managed by a decentralized autonomous organization (DAO) known as AaveDAO. And its issuance will take place in transactions on the lending platform. To oversimplify somewhat, it will actually be collateralized by collateral.

GHO platform stablecoin

The platform’s native stablecoin helps diversify [traditional] stablecoins. And that includes in the Aave protocol itself. As well as the GHO revenue generated by the interest. And charged to borrowers in the Aave protocol, will allow AaveDAO to allocate more funds to community participants. And including risk managers, developers and security experts.

Our experts say that GHO in its own way will help popularize DeFi as a non-volatile crypto asset. The company is also developing a social protocol called Lens. And it needs a network effect and interested users. On the basis of this protocol it is possible to build full-fledged analogs of existing social networks.

Wallet Pay tool can be integrated into any bot or service in Telegram to pay in Bitcoin or USDT

Messenger Telegram has introduced a new Wallet Pay cryptocurrency payment service in Bitcoins. As well as the cryptocurrency Toncoin (TON) and the Tether USD (USDT) stablecoin.

Wallet Pay is a tool that can be integrated into any bot or service in Telegram. And giving users the ability to pay in the three cryptocurrencies through the messenger interface.

The list of jurisdictions supported by Wallet Pay includes most countries in the world.

But with the exception of the United States and those states that are blacklisted by the Money Laundering Task Force (FATF). In particular, the technology does not work in Iran, Myanmar and North Korea.

The restrictions do not apply to Russia, Indonesia, Vietnam, Egypt. And other states where paying for goods and services with cryptocurrency is officially prohibited.

A Wallet Pay spokesperson said that the support team has received “several hundred” applications to join the service, but the developers have not yet implemented the Know your customer (KYC) service. And they are not yet ready to say who exactly will be the first users.

The Telegram Open Network (TON) blockchain was launched by brothers Nikolai and Pavel Durov in 2018. However, in 2020, the Durovs abandoned the project due to litigation with the US Securities and Exchange Commission (SEC). The TON network was supported by members of the TON Foundation community and they continued its development.

Our experts note that although Telegram is not directly involved in the development of the TON ecosystem, it remains interested in this network.

The number of active developers in cryptocurrencies is now higher than it was before the crypto market’s record growth in 2021

The number of developers in the field of cryptocurrencies has almost doubled in three years. This data follows from the report of the venture capital company Electric Capital. The growth of the indicator from June 2020 to the same month of this year was 92%.

Now the number of active developers is still higher than it was before the crypto markets hit record growth in 2021.

As of 1 June, the figure stood at 21,300. And that’s a quarter more compared to the same period in 2021. And about five months before Bitcoin set a record high above $69 thousand.

The authors of the report track the number of so-called commits – public edits and updates to the software code of projects. And which are placed in the public domain on the Github site. Analysts consider those developers who have continued to participate in writing the code of crypto services for at least a year to be beginners. Beginners are programmers with an experience of one to two years. And seasoned professionals are those whose experience exceeds two years.

Our experts note that professionals who have worked in the field of cryptocurrencies for at least one year. They also continue to make the majority of code commits.

Company Mastercard says its network will get a “level of programmability” similar to famous crypto-assets

Company Mastercard will begin pilot testing the Multi-Token Network (MTN) with tokenized bank deposits. The first trials will take place in the UK with a number of banks and financial institutions.

Selected banks and financial institutions will be given access to the MTN functionality to develop possible use cases for tokenized deposits.

Raj Damodaran, head of cryptocurrency and blockchain at Mastercard, expects That in the future the initiative will also extend to regulated Stablecoins and CBDC digital national currencies.

“Today, the catalyst for the movement of the global economy is regulated money in banks. We are starting to create tokenized bank deposits. The unit of money in the bank account acts as a digital asset in the blockchain, providing the same level of programmability as digital currencies in the crypto-ecosystem,” he explained in a comment for Coindesk.

In October 2022, Mastercard announced plans to become an intermediary for traditional financial institutions to trade cryptocurrencies. A Crypto Secure tool was also announced. And which will help banks to identify and prevent fraudulent transactions going through crypto exchanges.

Our experts note that earlier it became known that after September 25. The company Paysafe Payment Solutions will stop supporting payment services in euros for the cryptocurrency exchange Binance. Users of the largest cryptocurrency will have to update bank details. And possibly agree to the new terms and conditions to continue using SEPA services.

Miners had similar trends at the peak of the market in late 2021. And when cryptocurrency prices reached historic highs

Bitcoin miners are sending record high amounts of cryptocurrency to exchanges, according to analytics platform Glassnode. In the last week alone, they sent a record $128 million in cryptocurrency to exchanges. This is more than 4 times the amount of their daily income, the representatives noted.

Our experts note that during the bull period in the crypto market in 2021. And there were also several similar bursts of large transfers of miners’ income to exchanges, as they were fixing profits. Also amid the late 2022 crypto market crash, miners were sending large amounts of their Bitcoin earnings to exchanges.

Typically, when miners send their Bitcoin mining profits to exchanges. They do so in preparation to cash out in cryptocurrency to cover costs and lock in profits. Last week, Bitcoin reached its highest price of the year. And in doing so, reaching the $31185 mark on June 24. However, the sales of miners have not yet reflected on the rate of BTC.

Despite Bitcoin’s price growth of more than 80% this year, miners are still facing difficulties. Since July 2022, the profitability of bitcoin mining has fallen by more than 30%. And since the peak of the bull market in 2021, more than 80%. Rising hash rates and record increases in the complexity of mining, as well as rising electricity prices, suggest that selling mined Bitcoins may be a necessity to cover costs.

Our experts tell us what we need to know about the new EDX exchange for institutional investors with support from Fidelity and Charles Schwab

A new crypto exchange, EDX, started operating in the U.S. It is backed by such well-known players in the market of traditional finance as Citadel Securities, Fidelity and Charles Schwab. This development could change the digital asset landscape amid increased U.S. attention to the sector.

According to the press release, EDX was launched to “meet the needs of the world’s largest and most advanced financial institutions.” And many of which are still interested in cryptocurrencies. But they are skeptical of existing platforms, also because of the regulatory uncertainty they now find themselves in. The launch of the site coincided with a surge in Bitcoin. It was just after news of an application for a Bitcoin ETF by BlackRock.

The EDX Markets exchange for institutional investors only was first announced in September 2022. In addition to Bitcoin, the exchange allows trading in three other cryptocurrencies – Ethereum (ETH), Litecoin (LTC) and Bitcoin Cash (BCH). None of them were equated with securities in the sensational lawsuits from the SEC against major cryptocurrency exchanges Binance and Coinbase.

Unlike existing crypto platforms, EDX offers a so-called non-custodial model. And that means it won’t store customers’ digital assets during trading. Instead, EDX works with a third-party custodian. According to EDX Markets CEO Jamil Nazarali, the expectation of regulators. That crypto exchanges should be separated from broker-dealer functions, similar to the structure of traditional financial markets, will create opportunities for EDX.

Major Investors

The first capital to develop the exchange came from venture capital firms Paradigm, Sequoia Capital and Virtu Financial. By the time of launch, EDX had raised additional funding from new investors, including Miami International Holdings, GTS, GSR Markets and HRT Technology. At the end of the year, the company plans to launch its own EDX Clearing service for trades on the exchange.

The Sequoia portfolio also includes other major cryptoservices. The company has invested, for example, in projects such as Filecoiln and LayerZero. Paradigm focuses exclusively on the crypto market and has supported dozens of blockchain startups, including Uniswap, OpenSea, Synthetix, Starkware, Phantom, Optimism, dYdX, Blur and others.

The traditional market enters the cryptocurrency market

EDX customers will still be able to trade the four cryptocurrencies almost around the clock. But the site will share the functions of broker, dealer and exchange.

Many potential crypto investors are still interested in this area. But they are wary of the inherent volatility of the crypto market. Taking the example of the traditional stock market. And now EDX wants to attract these risk-averse customers. The exchange is aimed primarily at large investors. As well as those investors who are put off by the regulatory uncertainty and instability of the crypto industry.

Instead of retail investors trading cryptocurrencies directly through the EDX platform. And as is the case with other exchanges, they will interact with intermediaries. A similar approach is taken, for example, in stock trading on the New York Stock Exchange (NYSE). The reliability of such intermediaries is also an argument for potential clients.

“There’s no way someone trading through a reliable intermediary will lose a hard drive with $200 million worth of cryptocurrency keys and then spend years looking for it in a landfill,” says Jamila Nazarali, CEO of EDX Markets. And recalling that such cases did occur.

Our experts point out that the site will also provide clients with access to more favorable prices through transactions with special quotes for retail-only quotes. Because institutional traders often buy the asset in large quantities. Their transactions often lead to an increase in the price of such an asset, which leads to losses for market makers. To minimize this, the platforms can set inflated commissions. And which will be strongly felt for retail traders who trade in much smaller volumes. By isolating retail trading, EDX can offer clients better prices for small trades.

Deutsche Bank plans to increase fee income through new services and product offerings related to digital assets

Deutsche Bank has applied to the German Federal Financial Supervisory Authority (BaFin) for a license to provide digital asset custody services, Bloomberg writes.

“We are growing our digital asset and custody business. We just applied to Bafin for a digital asset license,” David Lynn, Deutsche Bank’s head of corporate banking, said at a conference June 20.

The move is part of the bank’s strategy to boost fee income, Lynn said. It also reflects the efforts of Deutsche Bank’s investment arm, DWS Group. On increasing revenue from cryptocurrency-related products.

Our experts point out that Deutsche Bank can hardly be called a cryptocurrency-friendly bank. However, its customers could buy cryptocurrencies using their bank accounts or cards from appropriately licensed European cryptocurrency companies.

The bank itself did not provide cryptocurrency services due to the lack of legislation. And companies offering crypto services in Germany opened accounts with other organizations (such as Solaris Bank) for their activities.

The cryptocurrency storage service launched by Deutche Bank is the easiest in terms of IT and regulation. This is made possible by the adoption of Markets in Crypto-Assets (MiCA) regulations. Which opens the door for many financial institutions in the EU to provide crypto services.

Also the Council of Europe announced the adoption of new legal rules for the digital asset industry in the EU MiCA in mid-May. The rules oblige cryptoplatforms, such as exchanges and custodians (asset custodians), to be mandatorily registered in one of the bloc’s member countries.

A virus software that attacks dozens of crypto-applications, called Mystic Stealer, has spread on the web.

Mystic Stealer is a virus program. It costs $150 per month and targets 21 cryptocurrency applications. As well as 40 browsers, more than 50 cryptocurrency browser extensions and many other services and plugins.

Reports on Mystic Stealer, published almost simultaneously by cybersecurity companies InQuest, Zscaler and Cyfirma, warn of the spread of the new malware and its effectiveness.

The program is rapidly gaining popularity in the cybercriminal community and is increasingly being used in attacks, the experts warned.

Mystic Stealer released version 1.0 in April but had already been updated to version 1.2 by the end of May. The vendor advertised the new software on various hacker forums. While offering it on a subscription basis of $150 per month or $390 per quarter. The project also has a telegram channel where development news, software features and other topics are discussed.

When launched for the first time, Mystic collects information about the operating system and sends data to the attacker’s server. Then it already performs its specific tasks of looking for data stored in browsers (cookies) and applications.

The full list of services that the program hacks is given in the Zscaler and InQuest report. They include Chrome, Edge, Firefox and Opera browsers. As well as browser-based cryptocurrency wallets TronLink, BinanceChain, Coinbase Wallet, MetaMask and many others.

The Cyfirma report states that industry “veterans” have tested the effectiveness of the virus program and confirmed that the program has become a powerful tool for stealing information.

Our experts also note that Mystic’s developer banned the program’s use in CIS countries and added an exception for those regions to its code.

The International Monetary Fund (IMF) is creating a new class of platforms for cross-border and domestic payments in central banks’ digital currencies

The International Monetary Fund (IMF) has begun developing an infrastructure for international central bank digital currency settlements (CBDC). A report released by the fund on June 19 said. That the new class of platforms is designed to ensure interoperability. As well as the efficiency and security of cross-border payments.

“Today’s new technologies allow the public sector to update cross-border payments infrastructure, and possibly domestic payments as well. <…> It’s about technology, but also about governance, which sets the “rules of the game”. This was stated by Tobias Adrian, head of the IMF Monetary System Department and one of the authors of the report, speaking at the IMF roundtable in Morocco before the publication of the document.

Trans-border payments are more complicated than domestic ones. Because they involve an exchange of value between parties located in different jurisdictions. And also subject to different laws, Adrian said. According to him, limited infrastructure makes international settlements expensive, slow and non-transparent. And the management of the existing system is “sporadic. And that leads to significant legal and operational costs.

According to the report, the IMF work on a new class of platforms is being done to speed things up. And also to make remittances between countries easier and cheaper. Experts are developing two types of platforms: for international settlements in CBDC and for domestic ones.

Trans-border settlements in tokens representing the reserves of member countries’ central banks will be provided by platforms called XC, according to an IMF report. They “create representations” of existing assets – reserves held by central banks, the authors explain.

Our experts note that another solution – CBDC platforms – is being developed to facilitate domestic payments in digital national currencies, both wholesale and retail. The report’s author emphasizes that such platforms will be supported by a strong regulatory framework.