PayPal has officially introduced its U.S. dollar-backed stablecoin, PayPal USD (PYUSD), designed for secure transfers and payments. Issued by Paxos Trust Company, PYUSD is fully backed by reserves including U.S. dollar deposits, short-term Treasuries, and cash equivalents.
Starting today, PYUSD will roll out gradually over the coming weeks. Eligible U.S. PayPal customers will gain the ability to:
– Transfer PYUSD between PayPal and compatible external wallets.
– Use PYUSD for peer-to-peer payments.
– Select PYUSD at checkout.
– Convert PayPal-supported cryptocurrencies to/from PYUSD.
As Dan Schulman, PayPal’s President and CEO, stated:
“The shift toward digital currencies demands a stable instrument that’s both native to blockchain and easily exchangeable with fiat like the U.S. dollar.”
Bridging Fiat and Web3 for Consumers, Merchants, and Developers
PYUSD aims to streamline transactions across traditional and digital economies by offering:
– Seamless integration for users and businesses transitioning to Web3.
– Blockchain efficiency, leveraging PayPal’s decades of payment expertise.
– ERC-20 compatibility, enabling adoption by developers, wallets, and decentralized apps (dApps).
👉 Discover how PYUSD enhances cross-border and remittance payments
Key use cases include:
– Reducing friction in virtual transactions.
– Facilitating international payments and remittances.
– Enabling direct payouts to creators and developers.
PYUSD will also debut on Venmo soon after launch.
Transparency and Trust: Fully Backed by Reserves
Paxos Trust Company, a regulated entity under the New York State Department of Financial Services (NYDFS), issues PYUSD with rigorous oversight. Reserve assets include:
– U.S. dollar deposits.
– Short-term Treasury securities.
– Cash equivalents.
| Feature | Detail |
|---|---|
| Redemption | 1 PYUSD = $1.00 (via PayPal) |
| Reserve Reports | Monthly disclosures starting September 2023 |
| Third-Party Audits | Independent CPA verification per AICPA standards |
Advancing Digital Currency Education and Adoption
PayPal is committed to fostering understanding of:
– Cryptocurrencies (e.g., Bitcoin, Ethereum).
– Stablecoins and their role in payments.
– Central Bank Digital Currencies (CBDCs).
Beyond PYUSD, PayPal allows U.S. users to:
– Buy, hold, and sell select cryptocurrencies.
– Access educational resources on risks and opportunities.
👉 Explore PayPal’s crypto initiatives
FAQs About PayPal USD (PYUSD)
1. How is PYUSD different from other stablecoins?
PYUSD combines PayPal’s payment infrastructure with blockchain transparency, offering a regulated alternative for mainstream users.
2. Who can use PYUSD initially?
Only eligible U.S. PayPal customers during the phased rollout.
3. What backs PYUSD’s value?
100% reserves in dollar deposits, Treasuries, and cash equivalents, audited monthly.
4. Can PYUSD be traded on exchanges?
Yes, as an ERC-20 token, it’s interoperable with external platforms.
5. Will PYUSD expand globally?
No immediate plans announced, but PayPal aims to align with regulatory frameworks.
6. How does PYUSD benefit merchants?
Low-cost, instant settlements and compatibility with existing PayPal tools.
PayPal’s PYUSD marks a pivotal step toward mass-market blockchain adoption, merging trust, compliance, and utility. As the digital economy evolves, PYUSD could redefine how value moves online.