PayPal’s branded stablecoin, which the payments company launched on Monday, is likely to be a trendsetter.

Multiple payments, e-commerce companies and banks, including large traditional financial institutions, have expressed interest in using or issuing digital dollars with Paxos, the issuer of PayPal’s
PYPL
PYUSD, according to a source familiar with the negotiations.

No names have been disclosed, but Walter Hessert, Paxos’ head of strategy, said in a CoinDesk interview Tuesday that the firm “has talked with a lot of the largest technology and financial services companies about stablecoins, integrating stablecoins, launching white label stablecoins in some cases.” He added, “we think there’s going to be a lot of really exciting followers here to PayPal.”

Lisa Ellis, MoffettNathanson analyst, says “I assume as soon as there’s legislation and proper guardrails, we’ll see big banks having stablecoins the same way they have any other financial instruments that are used to create liquidity in all different types of markets.”

Stablecoins are digital assets backed by collateral and usually designed to track a traditional currency, often the U.S. dollar. Although there are many players, the field is dominated by two cryptocurrencies, tether (USDT) and USD coin (USDC

USDC
).

PayPal’s launch marks a revival of Paxos’ white-label service after New York State regulators ordered the firm to stop minting what had been the No. 3 stablecoin Binance USD (BUSD
BUSD
) February. Regulators cited “several unresolved issues related to Paxos’ oversight of its relationship with Binance,” the world’s largest cryptocurrency exchange, which has also run afoul of federal regulators at the Securities and Exchange Commission and the Commodities Futures Trading Commission, both of which have sued it.

In response to questions about a potential stablecoin or even a bank version known as a deposit token, JPMorgan, Goldman Sachs and BNY Mellon, all active in digital assets, declined to comment to Forbes earlier this summer.

The world may not be in dire need of more dollar-pegged tokens, but run conservatively, the stablecoin business can be lucrative. Notwithstanding its murky financial reporting, Tether

USDT
, issuer of USDT, said it generated over $1 billion of profit in each of the first two quarters of the year thanks to the yields it is earning on the assets backing $83 billion worth of its tokens. Circle, USDC issuer and Tether’s closest competitor at $26 billion, has not released financial figures since a failed effort to go public last year, but based on its assets under management the firm could be generating up to $2 billion in gross revenue this year.

PayPal, whose shares spiraled to a six-year low in May and are down 12.9% this year, is eager to cash in. “Over time, going back to us as a payments company, we are interested in driving payment flows here that we will also be monetizing in a number of ways that are beyond just strictly the monetization of the reserve,” said Jose Fernandez da Ponte, PayPal’s senior vice president and general manager of blockchain, crypto and digital currencies, in a Bloomberg interview.

Neither PayPal nor Paxos responded to Forbes’ inquiry about the financial terms of their arrangement.

PayPal’s stablecoin comes as Congress is reviewing a bill to establish a federal regulatory framework for stablecoins.

source