PayPal, the San Jose-based payments giant, is set to revolutionize the digital payments landscape with the launch of its first-ever stablecoin, PYUSD.
PYUSD, issued by Paxos Trust Co., is backed by a combination of US dollar deposits, short-term Treasuries, and similar cash equivalents, making it a reliable and secure digital asset.
The stablecoin is pegged to the US dollar, ensuring its value remains stable and predictable for users.
PYUSD will be rolled out to PayPal’s customers in the United States with potential expansion to other regions in the future.
With this venture into stablecoins, PayPal’s Chief Executive Officer, Dan Schulman, aims to consolidate the company’s position as a dominant player in the digital payments ecosystem.
Stablecoins have been around for nearly a decade but have primarily been utilized by traders for moving digital assets between exchanges.
They have had limited impact on consumer payments until now, with the total value of stablecoins in circulation estimated at approximately $126 billion, according to CoinGecko.
USDT by Tether Holdings Ltd. is the largest stablecoin, commanding a 67.2% market share.
However, PayPal’s entry into the stablecoin market could disrupt the status quo. The company perceives a rising demand for an alternative stablecoin due to the concentration of the market, and it believes that the regulatory environment is evolving toward more clarity, making the time ripe for PYUSD’s introduction.