PYUSD: PayPal’s Stablecoin Makes Strategic Moves to Capture Market Share

Since its launch, PYUSD has faced stiff competition from leading stablecoins like Tether (USDT) and USD Coin (USDC), which dominate the market with significantly larger market capitalizations.

PayPal (NASDAQ:PYPL) is making an effort to increase the use of its stablecoin, PYUSD, by collaborating with Xoom, Cebuana Lhuillier, and Yellow Card to provide remittance services.

Here's a summary of the recent developments:

1. Xoom to Process PYUSD Disbursements: PayPal's Xoom will integrate PYUSD for processing disbursements, offering faster and more cost-efficient remittance solutions. This initiative aims to cater to the financial needs of underbanked populations.

2. Cebuana Lhuillier Partnership: The financial services provider in the Philippines will collaborate with PayPal to offer PYUSD-based remittances. With a vast network of over 3,500 branches and 25,000 partner locations, Cebuana Lhuillier aims to support Filipino communities globally.

3. Yellow Card Integration: The fintech firm, notably the first African company to list PYUSD, will further integrate the stablecoin into its platform. This move will facilitate transactions for PayPal customers throughout the continent.

4. Cross-Border Transfer Revolution: PYUSD, launched in 2023 by Paxos Trust Company, is pegged 1:1 to the US dollar and designed for integration into Web3 applications, wallets, and crypto exchanges. Being an ERC-20 token, it ensures interoperability with Ethereum.

5. PayPal's Web3 Push: In an effort to bolster PYUSD adoption, PayPal has forged partnerships with MoonPay, Crypto.com, and Phantom, among other Web3 infrastructure providers. Earlier this year, PYUSD was also launched on the Solana blockchain.

6. Solana Integration Benefits: PayPal's decision to shift its PYUSD stablecoin to the Solana blockchain was prompted by the high Ethereum transaction fees. By utilizing Solana, PayPal was able to reduce expenses by up to 90%.

7. Crypto Accessibility Expansion: PayPal's strategy involved making PYUSD more accessible for everyday transactions, ultimately aiming to increase cryptocurrency availability for both consumers and businesses.

8. On-Chain Transfers and Crypto Trading: PayPal enabled on-chain transfers of cryptocurrencies from PayPal wallets to external wallets, while also introducing crypto trading capabilities for American retailers. This step allowed businesses to directly purchase, sell, and hold bitcoins.

9. Bitget Exchange Listing: In a significant move, PYUSD was also listed on Bitget, a top-tier cryptocurrency exchange. This integration highlighted PayPal's compliance-driven strategy, which is further supported by BitLicenses from the New York State Department of Financial Services.