PYUSD, a stablecoin issued by PayPal and Paxos, has reached an unprecedented market capitalization of $1 billion as of August 24, 2024.
This significant growth is largely attributed to its recent support on the Solana blockchain, which has sparked a surge in supply and user activity.
Explore the factors behind PYUSD’s rapid ascent and its implications for the broader DeFi ecosystem.
PYUSD Market Capitalization Reaches $1 Billion
On August 24, 2024, PYUSD (PayPal USD) surpassed a market capitalization of approximately $1 billion, according to data from CoinMarketCap.
PYUSD is a stablecoin pegged to the US dollar, co-issued by PayPal and Paxos, a U.S. regulated entity. It is the only stablecoin currently usable as a payment method within PayPal’s platform.
Moreover, PYUSD is issued on both Ethereum and Solana, with PayPal emphasizing its design for programmability and compatibility with widely-used exchanges, wallets, and decentralized applications (dApps).
This positions PYUSD as highly compatible with the existing Web3 ecosystem.
Since its issuance in 2023, PYUSD has steadily increased in market capitalization, despite periods of stagnation. As of August 24, 2024, it crossed the significant $1 billion mark for the first time since its launch.
Additionally, recent months have seen a sharp rise in monthly active users. According to a website developed by Visa and Allium Labs, the number of monthly active wallet addresses for PYUSD surged from approximately 6,600 in May 2024 to around 26,410 in July 2024.
Support for Solana Drives Rapid Growth
Initially launched on Ethereum, PYUSD's market capitalization stagnated until it began supporting Solana in late May 2024. Since then, its market capitalization has seen significant growth.
Data from DeFiLlama, a platform that collects DeFi-related data, shows that as of August 27, 2024, PYUSD’s supply on Solana has exceeded $655 million, closing in on USDT's approximately $690 million on the same platform.
In just one month, PYUSD’s supply on Solana has increased by 177%.
The supply of PYUSD on Solana has now surpassed its supply on Ethereum, where it was initially supported.
Various DeFi protocols built on Solana have increased yields for holding PYUSD, strengthening the incentive to hold PYUSD on Solana, which is seen as one of the key factors behind its growth.
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