PayPal stopped the stable coin project because of PaxosPayPal is suspending work on its stablecoin amid increasing regulatory scrutiny, Bloomberg News reported, citing a source.
The news comes a day after reports that the New York City Department of Financial Services is investigating Paxos, with whom PayPal was working to create a stable coin, Bloomberg reported, adding that the coin was expected to launch in the coming weeks.
"We are exploring a stable coin," Bloomberg quoted PayPay spokeswoman Amanda Miller as saying. "If and when we look to move forward, we will certainly work closely with the appropriate regulators."
PayPal confirmed early last year that it was working on a stable coin that would be backed one-to-one with the U.S. dollar. Paxos is licensed as a virtual currency by the New York regulator, which issued guidance on stabelcoins in June after the Terra collapse and told issuers that stabelcoins must be backed by assets that are held separately from the issuers' funds.
