2024-08-27
PYUSD (PayPal USD) is a stablecoin developed
by PayPal and Paxos.
The stablecoin is issued by Paxos Trust
Company, a regulated blockchain infrastructure platform.
Paxos ensures that every PYUSD token is
fully backed and redeemable for U.S. dollars.
Each PYUSD token is backed by highly
liquid and safe assets, such as U.S. Treasury bonds and dollar reserves.
PayPal introduced PYUSD to integrate
cryptocurrency with its payment platform. Users can buy, sell, hold, and
transfer PYUSD within the PayPal app. PYUSD can be used on DeFi platforms.
August 27, 2024 — PayPal's USD
stablecoin, PYUSD, has reached a significant milestone, achieving a market cap
of $1 billion.
This growth has been fueled primarily
by its expansion into the Solana ecosystem, where the token has seen rapid
adoption, surpassing its presence on the Ethereum blockchain.
As of August 27, PYUSD's market cap
stands at $1.013 billion, with $345 million attributed to Ethereum and $662
million to Solana.
The explosive growth on Solana can be
linked to enhanced yield incentives offered by various Solana decentralized
finance (DeFi) protocols.
Those platforms such as Kamino, Drift,
and Marginfi have introduced boosted rewards for PYUSD deposits, offering
double-digit annualized yields to attract token holders.
In addition to the DeFi incentives,
Anchorage Digital, a prominent custody firm, has launched a new rewards program
aimed at institutional holders of PYUSD.
This program provides competitive
returns on PYUSD deposits, whether held in secure, on-chain custody or through
Anchorage Digital’s self-custody wallet, Porto.
Unlike other yield-generating methods,
the rewards are sourced from interest earned on US Treasuries backing PYUSD,
ensuring security and stability without involving rehypothecation, staking, or
lending.
PYUSD's growth positions it as a
formidable competitor to other leading stablecoins, including Circle's USDC,
with a market cap of $34 billion, and Tether's USDT, which holds a commanding
$118 billion market cap.
PayPal is another important player in
the stablecoin market.
