PayPal Shares First PYUSD Report as Stablecoin Market Fades to $131 Billion - Decrypt


18 Sep 2023 11:16 PM

While stablecoins like Tether and USDC face headwinds of their own, PYUSD's first reserves report shows a struggle to gain early adoption....

  • PayPal's stablecoin PYUSD has a long way to go in terms of adoption, despite its potential for global payments.
  • Paxos Trust, the company that issues PYUSD, reported $45.3 million in assets backing the stablecoin, with $1.5 million in cash deposits and the rest in reverse repurchase agreements collateralized with U.S. Treasuries.
  • The overall market capitalization of stablecoins has declined since the blowup of Terra's UST stablecoin, dropping from $188 billion to $131 billion.
  • Circle's USD Coin and Tether have faced challenges in maintaining their $1 peg, and Terra's UST implosion led to calls for stablecoin legislation.
  • PYUSD's market capitalization of $43.4 million is significantly lower compared to USD Coin and Tether, which account for 90% of the stablecoin market.
  • Stablecoins are not only used for cross-border payments but also heavily utilized in crypto trades.

The article provides a neutral analysis of PayPal's stablecoin PYUSD and its position in the stablecoin market.

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You May Ask

What is the current market capitalization of PYUSD?How are stablecoins backed?What challenges have USD Coin and Tether faced?What led to calls for stablecoin legislation?Besides cross-border payments, what other use cases do stablecoins have?

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