Jack Kubinec

Sling Money, a global peer-to-peer payments app leveraging stablecoins and Solana, has launched for users with US bank accounts, the startup announced this morning.&nbsp;



The app was conceived as a global equivalent to Venmo that uses the Solana network and Paxos’ USDP stablecoin to move money around instantly for low fees. The move comes as the crypto industry as a whole seems emboldened operating in the US following Donald Trump’s presidential election win last week.&nbsp;



Sling Money was founded in 2022 by Mike Hudack, who previously was chief product officer at the UK-based neobank Monzo. I spoke with Hudack back in August, and he said he became interested in building a global Venmo with crypto rails after sending crypto from London to a friend in San Francisco while investing in a Montana-based DAO. The KYC protocol and wallet onboarding was onerous, but the payment went through almost instantly, and Hudack realized he’d hit on something useful.



Since then, Sling Money has deployed in more than 75 countries, which now includes the US. By using stablecoins in tandem with Solana, which charges a fraction of a cent in transaction fees, Sling Money is very efficient, at least if you put aside the question of on- and off-ramping funds. It also plans to make use of RTP and FedNow, which are faster payments networks developed by banks and the Federal Reserve.



Sling Money has raised $20 million in seed and Series A funding, but its cap table doesn’t have typical crypto names on it: Union Square Ventures led its Series A in August, and Ribbit Capital and Slow Ventures are also investors. USV does a good number of crypto deals — it notably invested in Coinbase — but it is more of a generalist tech outfit. The same can be said for Ribbit and Slow. This is all to say that Sling Money isn’t really styled as a crypto app, and it doesn’t feel like one when you use it for peer-to-peer payments.



“It’s not necessarily a crypto product or a fiat product. It’s a payments product,” Hudack told me in August.



Venmo, the PayPal-owned payment platform with tens of millions of accounts in the United States, is the incumbent that Sling Money will have to chase. Like Venmo, Sling charges no transfer fees.&nbsp;



In an email, Hudack said he plans to pry away Venmo’s market share by starting “where Venmo isn’t” — that is, through international payments. Hudack said the team plans to follow WhatsApp’s growth model by building a “critical mass” of users for its international offering before convincing them that its product is good for use at home, too.&nbsp;



Hudack added that Sling Money’s bank transfers are faster than Venmo’s, and it sees a potential opportunity to undercut the 1.5-3% that Venmo charges for instant bank withdrawals.



Ben Mills, who is a Solana ecosystem founder who previously headed up product at Venmo, told me on the Lightspeed podcast that despite all its users, <a href="https://www.youtube.com/watch?v=NOCmHx8Dids">Venmo was not profitable</a>. The legacy money transfer system is riddled with expenses that Venmo abstracts away, but Mills compared this to “putting lipstick on a pig.” With cheap and instant transfers facilitated on blockchain rails, Sling Money could ditch some of these expenses altogether.



“As a society we’ve spent the last ~25 years connecting the world through media,” Hudack said. “You can stream video from any point on earth to any other point on earth, you can text anyone in the world, you can email, you can have a voice call with anyone on the planet. All for free. We’ve got the technology now to connect the entire world financially and we’re going to do it.”



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Payments

Sling Money opens ‘global Venmo’ to US users

Katherine Ross

PayPal’s stablecoin, PYUSD, is now available on Venmo.



The company announced the rollout in a blog post on Wednesday, Sept. 20. However, not all users will be able to purchase or send PYUSD to their friends or family, as only select users were picked this time around. PayPal did note that it will fully roll it out in the “coming weeks.”



“Individuals using compatible external wallets, and merchants accepting payments in PYUSD, will also be able to receive transfers from Venmo users. Blockchain network fees apply,” the blog post <a href="https://newsroom.paypal-corp.com/2023-09-20-PayPal-USD-is-now-available-on-Venmo">said</a>.



Read more: <a href="https://blockworks.co/news/paypal-pyusd-stablecoin-centralization">PayPal’s new stablecoin stirs centralization criticism</a>



The move comes after the company’s stablecoin was added to the New York State’s Department of Financial Services greenlist. Earlier this week, the NYDFS shuffled the list, removing tokens such as XRP and Doge.



Read more: <a href="https://blockworks.co/news/paypal-stablecoin-bitcoin-etf">The PayPal stablecoin is bigger news than any bitcoin ETF</a>



Outside of Venmo, <a href="https://blockworks.co/price/pyusd">PYUSD</a> is available on MetaMask, Kraken, Coinbase, Crypto.com, and Fireblocks, among others — including other crypto exchanges, wallets and custodians.



PayPal <a href="https://blockworks.co/news/paypal-launches-stablecoin">announced the stablecoin</a> in early August. The dollar-backed stablecoin is issued by Paxos Trust. PYUSD is a blockchain-based digital asset issued on <a href="https://blockworks.co/tag/ethereum">Ethereum</a> as an ERC-20 token.



“The shift toward digital currencies requires a stable instrument that is both digitally native and easily connected to fiat currency like the US dollar,” said Dan Schulman, PayPal’s president and CEO, at the time.



Paxos is expected to publish a monthly Reserve Report on the stablecoin, and an attestation of the “value of PayPal USD reserve assets.”



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PayPal

PYUSD available to all Venmo users ‘in the coming weeks’

Casey Wagner

Bankrupt crypto exchanges and Web2 digital payment apps have something in common: They aren’t insured by the FDIC, the Consumer Financial Protection Bureau (CFPB) reminded users this week.&nbsp;



In a Thursday release, the CFPB warned users that keeping cash in apps like Venmo, Cash App and PayPal is inherently dangerous.&nbsp;



“Billions of dollars” are currently stored in apps like <a href="https://blockworks.co/tag/venmo">Venmo</a> and <a href="https://blockworks.co/tag/paypal">PayPal</a>, the release said, but if these platforms were to go under, there is no guarantee clients would be made whole.



The companies disclose as much in their published legal terms. For instance, PayPal <a href="https://www.paypal.com/us/legalhub/pp-short-form">notes</a>, “FDIC insurance does not protect you against the failure of PayPal,” but individual consumers may nevertheless be unaware.



&#8220;Popular digital payment apps are increasingly used as substitutes for a traditional bank or credit union account but lack the same protections to ensure that funds are safe,” CFPB Director Rohit Chopra said in the <a href="https://www.consumerfinance.gov/about-us/newsroom/cfpb-finds-billions-of-dollars-stored-on-popular-payment-apps-may-lack-federal-insurance/">release</a>.



Similarly, crypto exchanges such as Coinbase and Gemini are not insured by the Federal Deposit Insurance Corporation (<a href="https://blockworks.co/tag/fdic">FDIC</a>). Bankrupt firms including <a href="https://blockworks.co/tag/voyager">Voyager</a> Digital, <a href="https://blockworks.co/tag/celsius">Celsius</a> and <a href="https://blockworks.co/tag/blockfi">BlockFi</a> are among many crypto companies that operated banking services without protection under the government.&nbsp;



The FDIC has for months attempted to crack down on crypto companies using “misleading” statements about their status as insured institutions.&nbsp;



In a July 2022 cease and desist <a href="https://www.fdic.gov/news/press-releases/2022/pr22056.html">letter</a> to Voyager Digital, the FDIC alleged the brokerage firm falsely advertised itself as an insured institution. 



“Based on the information gathered to date, it appears that these representations likely misled and were relied upon by customers who placed their funds with Voyager and do not have immediate access to their funds,” the FDIC said in the letter. 



Voyager advertised to clients that deposits of up to $250,000 would be insured through the FDIC because Voyager had partnered with FDIC-backed Metropolitan Commercial Bank to maintain a deposit account on behalf of users.&nbsp;



“Voyager is not itself insured by the FDIC, though, and so customers who invested through its cryptocurrency platform would not receive insurance coverage in the event of Voyager’s failure,” the FDIC added in the letter.&nbsp;



In August 2022, the FDIC informed crypto safety information provider CryptoSec.info, now known as ChainSec.io, incorrectly was advertising certain crypto exchanges as being FDIC insured. 



“The FDIC does not insure any crypto exchanges,” the <a href="https://www.fdic.gov/news/press-releases/2022/cryptosec-info-letter.pdf">letter</a> stated.



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exchanges

Not Just a Crypto Issue: PayPal and Venmo Lack FDIC Insurance Too

James Cirrone

Crypto transfers on Venmo are on the way, PayPal announced Friday during Consensus 2023.



Venmo customers will be able to transfer their crypto to friends natively on the app, and will also be able to move their digital holdings to external wallets and exchanges, according to a statement from PayPal. External transfers will be subject to network fees, PayPal told Blockworks.



The four accepted cryptocurrencies on Venmo are bitcoin, ether, litecoin and bitcoin cash.



PayPal will bring this feature, which has been <a href="https://blockworks.co/news/paypal-enables-crypto-transfers-to-external-wallets-exchanges">available on its platform since June 2022</a>, to Venmo “over the coming weeks starting in May 2023,” according to the statement.



This announcement comes a little over two years after Venmo first allowed <a href="https://newsroom.paypal-corp.com/2021-04-20-Introducing-Crypto-on-Venmo">crypto</a> on its platform in April 2021. Now that the popular payments platform allows transfers of digital assets, an estimated <a href="https://newsroom.paypal-corp.com/2022-08-18-Consumers-Are-More-Likely-to-Complete-a-Purchase-with-Venmo-Over-Traditional-Payment-Methods">90 million</a> Venmo users now have the ability to send or receive crypto.&nbsp;



PayPal, Venmo’s parent company, integrated crypto on its platform back in October 2020. The company also has a penchant for making crypto-related announcements at Consensus. 



PayPal’s general manager for blockchain, crypto and digital currencies Jose Fernandez da Ponte said he welcomes competition from players such as MoonPay and Robinhood Connect, which is another fiat-to-crypto on-ramp that was <a href="https://twitter.com/RobinhoodApp/status/1651638381376569344?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1651638381376569344%7Ctwgr%5E567881a810627addfb03c019fffc1a32a9b45c98%7Ctwcon%5Es1_&amp;ref_url=https%3A%2F%2Fcointelegraph.com%2Fnews%2Frobinhood-launches-fiat-to-crypto-on-ramp-for-self-custody-wallets-and-dapps">launched</a> by the financial services company on Thursday.



“Absolutely we are in competition…that’s the beauty of free markets. I’m a competitive person, and I want to beat the people in the market,” da Ponte told Blockworks at Consensus. “Consumers and merchants need choice and there should be more options to get fiat into crypto and it should be us.”



At last year’s conference, Blockworks reported that da Ponte said he was excited about <a href="https://blockworks.co/news/paypal-exec-excited-about-nfts-stablecoins-and-digital-identity">the potential of NFTs, stablecoins and digital identity</a>. This year, he reiterated his interest in NFTs specifically, saying that he thinks “the rumors about the death of NFTs have been greatly exaggerated.”&nbsp;



“I have enough gray hair to have been through a couple of these winters,” he quipped.



Katherine Ross contributed reporting.



Updated April 28, 2023 at 12:38 pm ET: Added comment from Jose Fernandez da Ponte, PayPal’s general manager for blockchain, crypto and digital currencies.



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Venmo Crypto Transfers Coming in May

Shalini Nagarajan

<div id="highlights-block_62a075457a2ad" class="highlights">
 <ul>
 <li>Select US users can transfer bitcoin, ethereum, bitcoin cash and litecoin to other wallets and exchanges</li>
 <li>Sending crypto outside of PayPal carries a fee determined by network congestion</li>
 </ul>
 
</div>



PayPal users can now transfer cryptocurrencies including bitcoin and ether to third-party wallets and exchanges, nearly two years after the payments giant opened up its platform to digital assets, the company announced on Tuesday.



Currently available to select US users, the feature will be extended to eligible US customers in the coming weeks, according to the <a href="https://newsroom.paypal-corp.com/2022-06-07-PayPal-Users-Can-Now-Transfer-Send-and-Receive-Bitcoin-Ethereum-Bitcoin-Cash-and-Litecoin" target="_blank" rel="noreferrer noopener">announcement</a>.



The San Jose, California-based company first began allowing customers to <a href="https://newsroom.paypal-corp.com/2020-10-21-PayPal-Launches-New-Service-Enabling-Users-to-Buy-Hold-and-Sell-Cryptocurrency" target="_blank" rel="noreferrer noopener">buy, hold and sell</a> bitcoin, ether, bitcoin cash and litecoin in October 2020. But they had no option to move out their holdings from the platform to crypto wallets such as MetaMask and Electrum, or exchanges such as Coinbase.



This feature was one of the most requested updates since the purchase of cryptocurrencies were allowed, PayPal said, and executives had been discussing its implementation for a year.



Now users will be able to move their cryptocurrency from PayPal to other crypto addresses, including hardware wallets — and send crypto to family and friends for free within the same payments network. Sending cryptocurrency outside of PayPal carries a fee, which may fluctuate depending on network congestion.


<div class="wp-block-image">
<figure class="alignright is-resized"><a href="https://lh3.googleusercontent.com/JgSA8dGIUX2lsgumZ5P1vEALBga8bun-aGC85F9isEqWuG9qMPfwKRn1qx0osQGfM16IoxrcIylvVL1bpu-8cedE-dswKommurHldMNLXArR55a-aH64IvtPrhfUrHb4Ksxk-yB2oG1bu7Qfuw" target="_blank" rel="noreferrer noopener"><img loading="lazy" decoding="async" src="https://lh3.googleusercontent.com/JgSA8dGIUX2lsgumZ5P1vEALBga8bun-aGC85F9isEqWuG9qMPfwKRn1qx0osQGfM16IoxrcIylvVL1bpu-8cedE-dswKommurHldMNLXArR55a-aH64IvtPrhfUrHb4Ksxk-yB2oG1bu7Qfuw" alt="The fintech giant first enabled crypto buying and selling in late 2020, but users couldn’t transfer their assets to third-party wallets" width="395" height="205"/></a></figure></div>


The capability still applies only to bitcoin, ethereum, bitcoin cash and litecoin.



PayPal’s announcement carries weight, as the fintech giant has more than 426 million active users who use the network to transfer money around the world and to make payments to merchants.



In March last year, PayPal rolled out the ability for US customers to use crypto as a form of payment to merchants using its “<a href="https://newsroom.paypal-corp.com/2021-03-30-PayPal-Launches-Checkout-with-Crypto" target="_blank" rel="noreferrer noopener">Checkout with Crypto</a>” service.&nbsp;



“We will continue to roll out additional crypto features, products, and services in the months ahead,” Jose Fernandez da Ponte, general manager of blockchain, crypto and digital currencies at PayPal, said in a statement.



Dan Schulman, PayPal’s president and CEO, revealed last year the firm’s <a href="https://cms.blockworks.co/paypal-ceo-smart-contracts-defi-apps-part-of-companys-crypto-plans/" target="_blank" rel="noreferrer noopener">crypto capabilities</a> will expand into the use of central bank digital currencies and smart contracts.&nbsp;



Some of PayPal’s revenue stems from crypto purchases made on its platform, but the exact amount isn’t clear because the company excludes this figure from its total payment volume.



Venmo, a popular payments app owned by PayPal, supports the buying and selling of cryptocurrencies but doesn’t yet have the ability to transfer them externally. 



As for Robinhood, the trading app rolled out a <a href="https://cms.blockworks.co/robinhood-deploys-beta-crypto-wallets-allowing-select-customers-to-transfer-off-platform/" target="_blank" rel="noreferrer noopener">beta version</a> of its crypto wallet to 1,000 customers that allowed them to transfer digital assets to other crypto wallets for the first time in January. It later opened the feature to <a href="https://cms.blockworks.co/robinhood-opens-crypto-wallet-service-to-2-million-more-users/" target="_blank" rel="noreferrer noopener">2 million</a> more “eligible” users — <a href="https://blog.robinhood.com/news/2022/3/28/the-future-of-investing-is-247-s8ksg" target="_blank" rel="noreferrer noopener">excluding</a> those in New York, Hawaii and Nevada, due to regulatory hurdles.



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