PayPal’s PYUSD Stablecoin Surpasses $1 Billion, Driven by Solana’s Speed and DeFi Power

• Solana’s low fees and fast transactions contributed to an impressive 271% growth for PayPal’s PYUSD since its launch.
• Solana now holds 64% of the total PYUSD supply, far surpassing Ethereum, which accounts for 36% of the stablecoin’s market share.
• 81% of PYUSD on Solana is actively used in DeFi protocols, driving strong adoption and further cementing its market dominance.

PayPal’s PYUSD stablecoin has seen an upswing, surpassing a $1 billion market cap. Following its recent integration with Solana, PYUSD has seen rapid adoption, boasting a 271% increase since its launch on the blockchain. 

Notably, 88% of this growth comes from Solana, marking it as a major player in the stablecoin’s success. This surge in adoption raises key questions about why PayPal chose Solana as the foundation for its digital currency expansion.

Key Features Driving PYUSD Adoption

In search of a high-performance blockchain, PayPal decided to expand PYUSD onto Solana after first launching it on Ethereum in August 2023. The stablecoin, backed 1:1 by U.S. dollars and regulated by the New York Department of Financial Services (NYDFS), had already gained significant awareness through its Ethereum deployment. However, PayPal needed a blockchain capable of providing faster transactions and lower fees to drive PYUSD’s utility for both consumers and merchants.

Solana’s near-instant settlement and sub-cent transaction fees made it an attractive choice. Beyond its speed and low cost, Solana’s unique token extensions were equally crucial to PayPal’s decision. 

These extensions, including confidential transfers and transfer hooks, allow token issuers like PayPal to implement necessary compliance without building separate infrastructure or relying on permissioned environments. This combination of speed, efficiency, and advanced features positions Solana as the preferred blockchain for PYUSD’s future growth.

DeFi Integration Fuels Growth on Solana

Beyond its technical features, PYUSD’s adoption on Solana has been fueled by its integration into decentralized finance (DeFi) protocols. Solana’s ecosystem of over 2,500 developers has helped drive growth through token incentives for DeFi projects. 

Notably, Kamino Finance has been one of the main DeFi platforms contributing to PYUSD’s rise. As a result, 81% of PYUSD on Solana is actively utilized in DeFi, further cementing the blockchain’s dominance over Ethereum in terms of market share.

Solana now holds 64% of the PYUSD supply, compared to Ethereum’s 36%. This large concentration of PYUSD on Solana has also facilitated low-cost transfers. According to data from Artemis, the median transaction fee for peer-to-peer PYUSD transfers has been around a tenth of a cent, reinforcing the stablecoin’s appeal for users seeking cheap and fast transactions.

PYUSD’s Continued Expansion

As PayPal strives to grow the utility and ubiquity of PYUSD, Solana remains at the forefront of this push. The combination of fast transactions, low fees, and compliance-friendly features continues to drive PYUSD’s adoption, particularly within DeFi. With Solana now serving as the primary home for PYUSD, the stablecoin is set to expand its presence even further, signaling a promising future for onchain payments.