Payments giant PayPal’s (PYPL) stablecoin PYUSD surpassed the $1 billion mark in market capitalization last week, CoinMarketCap shows.
Launched in 2023, PayPal USD is backed 1:1 by US dollars and is issued by Paxos Trust Company, a US-regulated crypto custodian. It competes with other regulated, dollar-backed stablecoins such as Circle Internet Financial’s USD Coin.
“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, in a 2023 statement.
An Ethereum-compatible ERC-20 token, PYUSD is the only stablecoin supported on PayPal’s payment rails. It is designed to be “available to an already large and growing community of external developers, wallets and Web3 applications” and easily onboarded by cryptocurrency exchanges, according to PayPal.
PayPal has been taking steps to expand PYUSD’s accessibility, including working with Anchorage Digital to launch a rewards program for clients who custody PayPal USD stablecoins with the crypto custodian.
In May, PayPal launched PYUSD on Solana, partnering with Crypto.com, Phantom and Paxos to on-ramp users onto the blockchain network.
It also partnered with Web3 infrastructure provider MoonPay to buy cryptocurrency using a PayPal account. That partnership extended to on-ramping users to crypto betting platform Polymarket in July.
Coinbase — which also has an institutional custody arm — incentivizes users to hold stablecoins on its platform as well. It currently offers approximately 5.2% annual percentage yield on USDC. Coinbase owns an equity stake in Circle.
[Source: Cointelegraph]
