Coinbase, the leading publicly traded cryptocurrency exchange, has announced the removal of transaction fees for PayPal’s stablecoin, allowing users to convert the token directly into U.S. dollars. This marks a significant step for PayPal’s continued commitment to cryptocurrency payments.
This initiative is a collaborative effort between Coinbase and PayPal designed to boost the adoption of PayPal’s stablecoin, known as PYUSD, which was launched in 2023. PayPal notes that the integration with Coinbase will enable merchants on its platform to settle directly in PYUSD, bypassing traditional finance systems.
Stablecoins, which are cryptocurrencies designed to retain a stable value (typically pegged 1:1 to the dollar), are frequently used by crypto traders to transfer funds among different tokens. Their usage has seen a significant surge in recent years, with supporters like PayPal asserting their potential for instant payments.
“The synergy of connecting PayPal and Coinbase’s consumer bases, introducing our merchants and Coinbase’s institutional access, creates an incredibly potent combination,” stated Jose Fernandez da Ponte, PayPal’s senior vice president of blockchain, crypto, and digital currencies.
The two companies are also planning future collaborations to bolster the use of stablecoins for payments and explore potential applications for PYUSD in decentralized finance platforms, which allow transactions directly on a blockchain network without intermediaries.
“This alliance is all about propelling the future of global payments, mainstreaming stablecoins, and advancing this technology,” expressed Lauren Abendschein, global head of institutional sales at Coinbase. The only other stablecoin for which Coinbase has offered zero-fee transactions is Circle’s stablecoin, USDC, the second-largest stablecoin in terms of market capitalization.
The partnership between Coinbase and PayPal unfolds as the U.S. Congress seems poised to pass a bill establishing regulations for stablecoins for the first time. Both the House of Representatives and the Senate have forwarded bills to regulate stablecoins, with the White House expressing a desire for a final bill to be passed by August. President Donald Trump, who received significant funding from the crypto industry during his campaign, has aimed to extensively revise U.S. cryptocurrency policies since taking office.
