Every now and then, a new player enters the crypto world, hoping to launch a product that’ll be more accessible to the masses and boost crypto adoption. PayPal, with the release of its PayPal USD stablecoin, aims to do the same.
What Is the PayPal USD Stablecoin?
PayPal USD (PYUSD) is a stablecoin backed by US dollar deposits, short-term US treasuries, and similar cash equivalents. It’s redeemable 1:1 for US dollars and is issued by the Paxos Trust Company as an ERC-20 compatible token on the Ethereum blockchain.According to PayPal, citing a “shift towards digital currencies,” the newly launched stablecoin aims to be a “stable instrument” that’s both digitally native and easily connected to fiat currencies like the US dollar.
This makes PYUSD easily accessible to developers, wallets, and Web3 applications, in addition to being easily adopted by exchanges. PayPal has designed PYUSD to “reduce friction for in-experience payments in virtual environments,” facilitating “fast transfers of value” between friends and family as well as easy international payments. Furthermore, PYUSD is Web3 compatible and will be available on Venmo soon (though there is no specific date for this as yet).
It’s also the only stablecoin supported within the PayPal network (and we don’t expect that to change anytime soon).
Is PayPal USD Different From Other Stablecoins?
Not really. The intention here is to create a convenient digital currency that comes with all the flexibility of digital assets with the stability a traditional asset provides. Not all stablecoins are pegged to a traditional currency, though,as some are regulated by algorithms.
How Will PYUSD Be Used?
Starting June 23, 2025, eligible PayPal customers in the US will be able to purchase PayPal USD and:
That said,the best ways to use stablecoinsapply to PYUSD as well, so there will be plenty of uses outside the PayPal ecosystem, especially considering the widespread compatibility PYUSD is taking into account at launch.
Availability will slowly start rolling out slowly to US-based PayPal crypto users, so it might be a while before everyone in the US gets access to the new stablecoin. Furthermore, if you’re in Hawaii, you might have to wait a little bit longer as PYUSD isn’t available there at the moment.
There’s no official word on who’s eligible yet, but you will require a PayPal Balance account. As far as purchasing is concerned, since the stablecoin is pegged to the US dollar, PYUSD can be bought or sold for $1.00.
PayPal’s Stablecoin Has a Shot
PayPal’s stablecoin has been in the works since the world-leading payment platform introduced crypto payments and purchases in 2021. While some hope that PayPal USD will boost crypto adoption and enable direct crypto payments to retailers, other crypto users are more skeptical about its effect on the wider crypto market.
Still, with PayPal’s backing, there is every chance PYUSD becomes a popular payment option in the future.
