PayPal USD (PYUSD) is a stablecoin issued by Paxos Trust Company in partnership with PayPal, a global online payment platform, designed for digital transactions. It's fully backed by U.S. dollar deposits, short-term U.S. Treasuries, and similar cash equivalents, maintaining a 1:1 value with the U.S. dollar. Regulated by the New York State Department of Financial Services, PYUSD offers a stable alternative to volatile cryptocurrencies.
History
On August 7, 2023, PayPal launched PYUSD with Paxos as issuer, marking a significant step in adopting a stablecoin for payments and transfers.
PYUSD is a stablecoin pegged 1:1 to the US dollar. It is regulated by the New York State Department of Financial Services and backed by highly liquid assets such as US dollar deposits and US Treasuries, ensuring its stability and providing users with confidence in its consistent value.
Since September 2023, Paxos has published a monthly Reserve Report for PYUSD, transparently detailing the stablecoin’s reserve components. Additionally, a third-party validates PayPal USD's reserve holdings to further assure its stability.
In November 2023, the SEC announced a legal investigation into PayPal and Paxos, the entity responsible for issuing the stablecoin. On July 9, 2024, Paxos received a formal termination notice from the SEC, indicating no enforcement action would be recommended against Paxos Trust Company. However, on Apr 29, 2025 the SEC concluded their investigation on PayPal and will not take action.
What Makes PYUSD Unique?
As of April 2025, Coinbase has removed the fees associated with purchasing PYUSD from USD and redeeming USD from PYUSD. This was a joint effort by Coinbase and Paypal to increase adoption of PYUSD. This will allow merchants to settle purchases in PYUSD instead of using more volatile crypto.
Coinbase is the largest US cryptocurrency exchange that allows users to buy, sell, and manage various digital currencies like Bitcoin, Ethereum, and more. Founded in 2012, Coinbase has grown to become one of the most popular exchanges due to its user-friendly interface and robust security measures.
PayPal is a global online payment platform that facilitates digital money transfers, providing an alternative to traditional paper methods like checks and money orders. Founded in 1998 and headquartered in San Jose, California, PayPal has become a staple in e-commerce by offering secure and convenient payment processing services.
How PYUSD is Used
PYUSD is a digital currency offering versatile functionalities for users. It can be transferred to compatible crypto wallets, enabling seamless integration with both PayPal and externally owned wallets. This flexibility allows users to purchase goods with ease, as PYUSD automatically converts to fiat currency at the point of sale. Additionally, users can trade PYUSD for any of PayPal’s supported currencies.
PYUSD is particularly beneficial for various applications, including international transactions and secure online shopping, making it an ideal choice for freelancers and e-commerce activities.
You can buy, hold, and bridge PYUSD in the MEW Mobile app if you prefer using mobile, or by downloading the Enkrypt browser extension if you prefer using a web browser.
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