PayPal’s stablecoin, PayPal USD (PYUSD), has surpassed a significant milestone, reaching a $1 billion market capitalization, as reported by CoinMarketCap. Launched in 2023 and pegged 1:1 to the US dollar, PYUSD is issued by Paxos Trust Company, a regulated crypto custodian in the United States.
PYUSD is an Ethereum-compatible ERC-20 token, making it the only stablecoin integrated into PayPal’s payment system. The company has designed it to be easily adopted by developers, wallets, and Web3 applications, aiming to bridge the gap between traditional fiat currencies and the digital currency landscape.
To boost PYUSD’s accessibility, PayPal has collaborated with Anchorage Digital to launch a rewards program for clients who store their stablecoins with the custodian. In a strategic move, PayPal also expanded PYUSD to the Solana blockchain in partnership with Crypto.com, Phantom, and Paxos, further integrating the stablecoin into the crypto ecosystem.
Additionally, PayPal has teamed up with Web3 infrastructure provider MoonPay, allowing users to purchase cryptocurrencies using PayPal accounts. This partnership extended to the crypto betting platform Polymarket in July, enhancing PYUSD’s utility in the digital currency space.
Despite these efforts, PYUSD still trails significantly behind its competitors, Tether (USDT) and USD Coin (USDC), which boast market capitalizations of nearly $118 billion and $35 billion, respectively. While PYUSD’s growth is notable, it faces an uphill battle to match the dominance of these leading stablecoins.