Fiserv and PayPal announce stablecoin interoperability plans - Trade Treasury Payments

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Fiserv and PayPal announce stablecoin interoperability plans

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Fiserv and PayPal have announced plans to develop interoperability between their respective stablecoins, FIUSD and PayPal USD (PYUSD). 

The collaboration brings together two established players in global financial services. By combining Fiserv’s reach across banking and commerce with PayPal’s digital wallet infrastructure, the firms intend to expand the use of programmable money in practical, regulated contexts.

Takis Georgakopoulos, COO at Fiserv, said, “Our expanded relationship with PayPal furthers our mission to scale stablecoin-powered payments – leveraging our position at the intersection of banking and commerce to build more efficiency and optionality into the payments ecosystem.”

From PayPal’s perspective, the emphasis is on solving persistent inefficiencies. 

Frank Keller, executive vice president at PayPal, said, “Businesses around the globe face common problems. They don’t receive funds fast enough, they are combating inflation, and many face currency value fluctuations. Blockchain-based technology solves many of these challenges by enabling faster transfers, at any time of day, nearly anywhere around the globe. Together with Fiserv, we will help bridge the gap between traditional financial systems and new technologies, enabling faster, more cost-effective, and globally accessible payment options for merchants.”

As part of the announcement, Fiserv confirmed the development of FIUSD, a stablecoin designed specifically for financial institutions. FIUSD will enable banks to offer digital asset capabilities within familiar regulatory and operational frameworks. PYUSD, issued by Paxos and introduced in 2023, has already seen uptake in cross-border transactions and startup financing.

The firms will now work to integrate their stablecoins into targeted payment flows, with an initial focus on international transfers and merchant use cases.

Both firms acknowledge the inherent risks tied to stablecoin adoption. These include infrastructure dependencies and the absence of FDIC or SIPC insurance protections. Users and institutions are advised to assess custody solutions, redemption terms, and platform reliability before onboarding.

PYUSD is issued by Paxos Trust Company and backed 1:1 with US dollar reserves, including Treasuries and cash equivalents. It is available to eligible users through PayPal and Venmo. FIUSD’s design will reportedly prioritise compliance and institutional compatibility, although further technical detail has not yet been disclosed.

While regulatory uncertainty remains a constraint, initiatives like this suggest that stablecoins are increasingly being viewed as infrastructure for the next generation of payments.