LAB51 logo

PayPal Launches PayPal USD Stablecoin

paypal stablecoin
By Luigi Savarese
Luigi Savarese

3 Min

August 7, 2023
  • PayPal has launched its U.S. dollar-pegged stablecoin, PayPal USD (PYUSD).
  • Paxos Trust is issuing the stablecoin, backed by Treasuries.
  • PYUSD is available to PayPal users in the U.S. to transfer funds, fund goods and services purchases, or convert to other cryptocurrencies.
  • The launch of PYUSD is a major vote of confidence in the stablecoin market and could help to accelerate its adoption by mainstream investors.

PayPal launched its own U.S. dollar-pegged stablecoin, PayPal USD (PYUSD). The Ethereum-based token is now available to PayPal users in the U.S. and is the first time a major financial company has issued its stablecoin.

PYUSD can be transferred between PayPal and supported external wallets, funded goods and services purchases, or converted to or from any of PayPal's supported cryptocurrencies. Paxos Trust, the New York-based crypto financial services firm, is issuing the stablecoin. Moreover, it is fully backed by U.S. dollar deposits, short-term Treasuries, and similar cash equivalents. It is always redeemable for dollars and exchangeable for other cryptocurrencies available on PayPal's network.

In a press release, Dan Schulman, president and CEO of PayPal, said that the company's commitment to "responsible innovation and compliance" and its track record of "delivering new experiences to our customers" provides the foundation necessary to contribute to the growth of digital payments through PayPal USD.

Related Articles

LAB51 on Paypal Stablecoin

The launch of PYUSD is a significant development in the Web3 space and is a sign of PayPal's commitment to the future of digital payments. The stablecoin will make it easier for PayPal users to participate in the crypto economy and could help to drive mainstream adoption of cryptocurrencies.

PYUSD is the latest in a series of moves by PayPal to expand its crypto offerings. In 2020, the company began allowing users to buy, sell, and hold Bitcoin, Ethereum, Bitcoin Cash, and Litecoin. In 2021, it expanded its crypto support to Venmo, its popular peer-to-peer payments app.

Benefits of PayPal Stablecoin

There are several benefits to using PayPal USD, including:

  • Stable value: PayPal USD is pegged to the U.S. dollar, meaning its value is relatively stable. This makes it a good option for users who want to avoid the volatility of other cryptocurrencies.
  • Convenience: PayPal USD can be used to purchase goods and services on PayPal's platform, as well as to transfer funds between PayPal and external wallets. This makes it a convenient way to use cryptocurrencies in everyday life.
  • Security: PayPal is a well-established and reputable company with a strong security track record. Hence, this means users can be confident that their funds are safe when using PayPal USD.

The launch of PYUSD is a further sign of the growing acceptance of cryptocurrencies by mainstream financial institutions. Other major financial companies will likely follow PayPal's lead and launch their stablecoins shortly.