A highlight from CARPE CONSENSUS: PayPal Steps Into the Stablecoin Game
This is Carpe Consensus. Join hosts Ben Shiller, Danny Nelson and Cam Thompson as they seize the world of crypto. Hello and welcome to Carpe Consensus. This is a podcast from the CoinDesk Podcast Network and I am Ben Shiller and welcoming today Cam Thompson. Hi Cam. How are you? It looks like you're on holiday. Yes. Well, not on holiday, just working remotely from another location. I am currently in Maine right now and it's very nice, very breezy, a little chillier up here, but I'm not complaining. You know, lots of lobster. Mmm, lobster, nice. Lobster for breakfast, lobster for lunch. Literally, lobster at every meal. So we've got a bumper packed show today. Danny Nelson is out. He's at a hackathon in Utah, which is a nice place to be this time of year as well. And then we're going to get to some big news in the world of crypto, which is the issuance of a new stablecoin backed by PayPal. We're going to talk about its very big news and we'll have David Morris, who's the chief columnist here at CoinDesk to talk about that a little later on. And let's get to that. OK, we're going to get to our next segment now, and we're joined by the great David Morris here, the chief columnist here at CoinDesk. Welcome, David. Hey, glad to be here, Ben. Good to have you. So we're going to get to the big news this week, which is a new stablecoin from PayPal. It's on Ethereum. It's USD backed and it's very big deal in crypto. PayPal has about four hundred and thirty five million customers. So this is seen as a big mainstreaming moment for crypto. What do you make of this, David? What are your big takeaways? Yeah, the implications of this are, I think, pretty big. I think there are a lot of questions that still remain to be answered about what PayPal's real motivation is here, what their business case is. But it's going to have, I think, pretty significant impacts, particularly on regulation, because I think this this does put a fire under people in terms of getting some kind of structure in place by which these things are supposed to operate. And I think there are some interesting possibilities from a consumer perspective, although I wonder about exactly how PayPal is going to get people to to use this versus their regular service and how those will interact. So lots, lots to discuss. Definitely. So David, about 30 minutes ago, you tweeted PayPal USD will be the most censored and seized centralized cryptocurrency of all time. What are your thoughts behind that? Yeah, well, I think this is a very important thing in the fact that I think it's not totally widely understood is one of the reasons I tweeted that thing is because, you know, everybody talking here, but maybe not all listeners know that not just Circle and USDC, but Tether, which is, you know, mysterious offshore entity. They still cooperate with governments when they get anti terrorism, anti money laundering notices asking that they block particular users. So there are, you know, pretty constant cases of censorship on Circle and Tether. I say PayPal will be the worst for two reasons. One is that PayPal already has a really established track record of being very quick with blocking people, seizing people's accounts, providing very little explanation, doing it for unclear reasons. And then second, I think that there will be probably a decent number of people who try and use this product in an illicit way thinking that it is uncensorable because it's crypto. And I wouldn't put it past PayPal that that is at least like part of their thinking here, not to say that it's part of their strategy or the reason they're doing it. But I think that they they must be aware that there will be a certain number of people who misuse this product thinking it's something that it's not. So that was what I was thinking there. So just to get on that kind of centralising point that you made, I mean, a lot of people are quick to say this is good for crypto. But I guess the question becomes, what do you mean by crypto? Because, you know, okay, if you have this stable coin, you can buy Bitcoin and Ethereum on PayPal with it. But it isn't necessarily an endorsement of an open source version of crypto, is it? I mean, a stable coin issued by a company like PayPal is not really crypto in the sense of, you know, what we mean by the Bitcoin white paper. Yeah, I mean, I think that we're in the territory now where there is a, you know, it's not just PayPal, there's a debate within the crypto community about what that means and what we're actually going for. And I think it's a legitimate debate at this point, because you do have fully decentralised, fully uncensorable things like Bitcoin. But stable coins are clearly a part of the ecosystem.