PayPal Launches U.S. Dollar Stablecoin, PayPal USD

PayPal today announced the launch of a U.S. dollar-denominated stablecoin, PayPal USD (PYUSD), holding the belief that fully-backed, regulated stablecoins have the potential to transform payments in web3 and digitally native environments. 

PayPal USD is designed to contribute to the opportunity stablecoins offer for payments and is 100% backed by U.S. dollar deposits, short-term U.S Treasuries and similar cash equivalents. It is redeemable 1:1 for U.S. dollars.

The stablecoin is issued by Paxos Trust Company, a fully licensed limited purpose trust company subject to regulatory oversight by the New York State Department of Financial Services (NYDFS). In June 2022, PayPal was issued a BitLicense by NYDFS after previously obtaining a conditional BitLicense.

"The shift toward digital currencies requires a stable instrument that is both digitally native and easily connected to fiat currency like the U.S. dollar," said Dan Schulman, president and CEO, PayPal. "Our commitment to responsible innovation and compliance, and our track record delivering new experiences to our customers, provides the foundation necessary to contribute to the growth of digital payments through PayPal USD." 

Beginning in September 2023, Paxos, the regulated blockchain infrastructure platform for enterprises, will publish a public monthly Reserve Report for PayPal USD that outlines the instruments composing the reserves.

In addition to offering PayPal USD for U.S. accountholders, PayPal currently offers customers the ability to buy, hold, sell and transfer select cryptocurrencies, and provides educational content to help accountholders understand the risks and possibilities surrounding the technology.