It’s been a week since the payments company PayPal announced it was launching a stablecoin, called PayPal USD.  Stablecoins are a kind of cryptocurrency that has a set value relative to a particular asset — in the case of PayPal, the U.S. dollar. They can act as a kind of bridge between other cryptocurrencies and fiat currencies. Some also believe they could revolutionize payment technology. But there is no regulatory framework in the U.S. for stablecoins specifically … yet.

The stablecoin market is worth north of $100 billion. And without specific regulations, those assets aren’t legally protected in the U.S.

“You could have a situation where you have a run on a stablecoin,” said Timothy Massad, a former chair of the Commodity Futures Trading Commission, now at Harvard, who’s also currently advising PayPal on its new stablecoin. 

Massad noted that creating a regulatory framework could deal with this kind of insolvency and encourage more of the private sector to experiment with stablecoins.

“Our system is actually relatively slow and expensive,” said Massad. “These new digital technologies represent a potential advance.”

There’s legislation before Congress now on stablecoins. The Treasury Department and the Federal Reserve are doing research on them, too. Wharton’s Kevin Werbach said that PayPal’s move could hurry everyone along. 

“It should change the calculus somewhat, in terms of the possibility that significant funds will start flowing into stablecoins in the traditional financial system,” said Werbach. 

Werbach predicted we’ll see rules in one form or another in the next year.