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PayPal’s PYUSD nears $1 billion boosted by Solana integration

PayPal’s PYUSD nears $1 billion boosted by Solana integration

GrafaGrafa2024/08/19 06:45
By:Liezl Gambe

PayPal's PYUSD (CRYPTO:PYUSD) stablecoin is rapidly approaching the $1 billion mark, driven by its successful expansion to the Solana blockchain

Initially launched on Ethereum in August 2023, PYUSD saw steady growth, but its adoption soared following the integration with Solana in May 2024. 

This move has propelled PYUSD to rank among the top six stablecoins, with its supply growing by over $300 million, or 45%, in the past month alone. 

As of now, PYUSD’s total supply stands close to $820 million.

The integration with Solana has been a key factor in PYUSD's rapid growth. 

Solana-based decentralised finance (DeFi) protocols, such as Kamino and Drift, have offered attractive incentives for PYUSD users, providing nearly 20% annual returns for deposits. 

These incentives have driven the balance of PYUSD on Solana (CRYPTO:SOL) to surpass that on Ethereum (CRYPTO:ETH), with $462 million held on Solana compared to $366 million on Ethereum. 

This development has made PYUSD the third-largest stablecoin on Solana, following Circle's USDC (CRYPTO:USDC) and Tether's USDT (CRYPTO:USDT).

Despite its success, some market observers have expressed concerns about the sustainability of the high yields offered by Solana protocols, drawing comparisons to the failed Terra UST (CRYPTO:UST) stablecoin. 

However, PYUSD is fundamentally different, as it is fully backed by the US dollar, meaning each PYUSD token issued is supported by an equivalent dollar in reserve, providing greater stability.

The rapid growth of PYUSD on Solana has also led to broader adoption on cryptocurrency exchanges. 

Bybit, one of the top three exchanges, now supports PYUSD deposits and withdrawals on the Solana network. 

Bybit has recently experienced significant user growth, reaching 40 million users and adding 10 million new users in less than a month.

As PYUSD continues to gain traction, its integration with Solana highlights the growing importance of blockchain networks in expanding the utility and adoption of stablecoins. 

The coming months will be crucial in determining whether PYUSD can maintain its momentum and reach the $1 billion milestone.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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