Stablecoins’ ‘Giant Leap’ Into Mainstream Finance, PayPal PYUSD & USD1 In Focus

Stablecoins have been in the headlines this week and this time the conversation is shifting in favor of PayPal USD and USD1.

PayPal USD has been in the headlines this week, first for its recovery back above the $1 billion marketcap. The stablecoin pushed to a $1.01 billion marketcap on Monday.

Growing Stablecoin Sector To Become $2 trillion Industry?

The Paypal story is yet another development illustrating the growing integration of stablecoins into mainstream finance. This growth is likely to create a huge shift within the financial sector, in the long term.

To a large extent, this is becoming apparent as the US Government has been expressly making its pro-crypto stance clearer in the recent months.

US treasurey secretary, Scott Bessent, recently stated before the Senate Appropriations Committee that the stablecoin sector is set to be a $2T industry.

In fact, Bessent further went on to say that stablecoins held the potential to make the dollar stronger in global finance.

Additionally, just last month, US Vice President J D Vance emphasized on digital money being of benefit to the US dollar, that it would be “a force multiplier of our economic might.”

Overall, the stablecoin market has grown to be over $250 billion. Standard Chartered predicted that the stablecoins in circulation by 2028 would be $2 trillion.

How Paypal Made it Happen with PYUSD

The PYUSD stablecoin initially attained the $1 billion marketcap milestone on 25 August 2024 a record pace of growth.

However, its bid to join the big leagues in its category was watered down by a massive pullback. It resulted in its marketcap retreating below $500 million.

PayPal USD has since been marching its way into recovery. Its expansion might be the key to unlocking more growth.

The network was initially launched on the Ethereum network, but its launch on Solana accelerated its growth.

PayPal USD expands into the Stellar blockchain

PayPal recently announced plans to expand PayPal USD into the Stellar network. The company described the move as an important step in the right direction.

According to the official announcement, the expansion aims to take advantage of Stellar’s ease of integration, low transaction cost high throughput.

The remittance company also expects the move to enhance access to the stablecoin through digital wallets.

Stellar network’s availability across 170 countries is among the main reasons why the PayPal selected the network.

The decision highlighted the “full-speed ahead” approach that stablecoin issuers have been taking, especially as the U.S moves to legalize stablecoins.

PayPal has been making an effort to make sure that PYUSD is available across multiple blockchains. It was initially only available on Ethereum and Solana. It expanded into Berachain, Plume mainnet and Flow blockchain this year.

Most of the PayPal USD in circulation was on Ethereum at the time of observation. It held over 68% dominance while Solana was second at 21%.

PYUSD still has a long way to go as far as adoption is concerned but the listing on Stellar blockchain could potentially keep it in the fast lane.

However, it still has a huge gap to cover compared to mainstream stablecoins like USDC and USDT.

Justin Sun Announces First USD1 Minted on Tron

Still on stablecoin matters, Tron founder Justin Sun recently announced the first USD1 mint on his network. For context, USD1 is the stablecoin launched by World Liberty Financial, an organization that is affiliated with U.S President Donald Trump.

USD1 has been around since March this year, making it one of the youngest stablecoins to grace the crypto market.

Although some may see it as just another addition to the fold, Justin Sun believes that USD1 marked a major step forward for stablecoins.

So, why the excitement about USD1? It turns out that the new stablecoin was well received in the market with many seeing it as a viable alternative to the mainstream stablecoins.

It was aimed at aggressive DeFi integration right off the bat, as well as support across multiple chains.

In addition, USD1 is pegged to the U.S dollar at a 1:1 ratio and it has been receiving heavy institutional backing.

Both PayPal USD and USD1 also appeared to be competing against each other as the latest additions to the stablecoin fold.

But which stablecoin will emerge on top? Well, some analysts believe that there is enough room for both to thrive.

While that may be true, their individual success will depend on the level of adoption. Moreover, some see these two stablecoins as fresh bids (by the organizations behind them) to take advantage of robust demand in the market.

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