PayPal has made waves by completing its first-ever business transaction using its stablecoin, PayPal USD (PYUSD). The payment was made to Ernst & Young via SAP’s digital currency hub, marking a major step forward in integrating stablecoins into corporate finance. While the invoice amount remains undisclosed, this move showcases the potential for instant payments through digital currencies in enterprise environments.

Launched in August 2023, PYUSD is pegged to the US dollar and backed by deposits and short-term US Treasurys. At the time of writing, its market capitalization sits at $699 million, making it the eighth-largest stablecoin, according to DefiLlama data.

Unlike volatile cryptocurrencies, stablecoins like PYUSD maintain a steady value, making them more suitable for everyday transactions. PayPal’s senior VP of blockchain, Jose Fernandez da Ponte, emphasized the appeal of stablecoins for businesses, calling it a "rational" choice for CFOs.

PayPal has been ramping up its digital asset services, allowing US business users to buy, sell, and trade crypto directly. Meanwhile, competitors like Robinhood and Revolut are eyeing the stablecoin market, as new regulations like the European Union's MiCA reshape the landscape.

Despite growing competition, Tether’s USDT continues to dominate the market, boasting a $119.7 billion market cap, far surpassing other stablecoins like USD Coin, which holds $35.3 billion.

PayPal’s first PYUSD payment highlights a shift in how businesses might handle transactions, sparking conversations about stablecoins’ future role in corporate finance.

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