PayPal is launching a stablecoin called PayPal USD (PYUSD) that will improve payment efficiency and customer experience, but short-term growth in cryptocurrency adoption is unlikely to be significant, according to a Bank of America research report.

- In the long term, PYUSD may face additional barriers to adoption due to competition from CBDCs and high-yielding stablecoins.

- PayPal USD will be available first on PayPal, then on Venmo and can be exchanged for dollars at any time.

- Bank of America does not expect the launch of PYUSD to lead to accelerated regulatory clarity, but the stablecoin may face regulatory hurdles.