In the midst of the current market instability, PayPal Holdings is strengthening its commitment to stablecoins, revealing plans to broaden the use of PYUSD across a wider range of products in 2025.
This strategic move positions the payment behemoth as a formidable contender against prominent stablecoins such as Tether (USDT) and Circle (USDC).
Insights from PayPal’s Leadership
During an interview with Bloomberg, Michelle Gill, General Manager of PayPal’s small business and financial services department, shared,
“An array of cross-border payments are anticipated, as US merchants look to settle invoices with overseas vendors and suppliers. The idea was: Can we facilitate this through PYUSD channels to eliminate currency conversion challenges, reduce friction, and save time?”
Moreover, in a significant move towards wider acceptance of stablecoins, PayPal is gearing up to incorporate PYUSD into its Hyperwallet platform to streamline global payments for freelancers and independent contractors.
This progression follows PayPal’s successful inaugural business transaction using PYUSD in 2024, emphasizing its dedication to broadening the utility of digital assets.
Purchased for $400 million in 2018, Hyperwallet will support PYUSD payouts as early as the initial half of this year.
On the Horizon
Looking forward, PayPal is set on further enhancing its crypto integration by enabling merchants to settle PayPal checkout transactions in digital currencies by the conclusion of 2025.
Commenting on this, PayPal’s CEO, Alex Chriss, stated,
“We have been discussing blockchain for about a decade now — the idea of these systems only truly materializes once you can actually start using them for transactions. And that is what we are enabling.”
Nevertheless, the stablecoin market is experiencing escalating competition as key players aggressively expand their footprint amidst changing regulatory landscapes.
Though Tether (USDT) has encountered compliance obstacles under Europe’s MiCA regulations, it has redirected attention to crypto-friendly territories like El Salvador.
In the meantime, Circle’s USDC has leveraged the momentum from the Solana [SOL] memecoin surge, nearly doubling its market share in the past year, while securing regulatory endorsements, including MiCA compliance and approval from Dubai’s DFSA.
Intensifying the rivalry, XRP has introduced RLUSD – A stablecoin now active on Ethereum and XRPL, showcasing an initial supply of 120 million.
Anticipated Challenges
Despite PayPal’s efforts to promote PYUSD adoption, the stablecoin faces stiff competition from established players like USDT and USDC.
According to the most recent data from VisaOnChainAnalytics, stablecoin transaction volumes for February 2025 amounted to $615 billion, with USDT leading at $415.61 billion and USDC trailing at $197.37 billion.
Conversely, PYUSD accounted for a modest $1.24 billion, underscoring the steep climb it faces in challenging dominant market figures.
Moreover, the market cap of PYUSD, which peaked at $1.01 billion in August, has since dwindled, falling below $500 million by December, indicating the hurdles ahead for PayPal’s stablecoin aspirations.