The Low Adoption of PayPal’s PYUSD Stablecoin: A Closer Look
PayPals crypto wordt bijna niet gebruikt
Despite its entry into the crypto market with the launch of the PYUSD stablecoin, PayPal’s adoption rates have been disappointing. The payment giant was expected to compete with other major stablecoin issuers like Tether and Circle, but so far, it has failed to make a significant impact.
The Expectations of PayPal’s Competitiveness
Many anticipated PayPal’s entrance into the stablecoin market to shake things up, with Circle CEO Jeremy Allaire even seeing this competition as beneficial for innovation. However, recent on-chain data suggests that PayPal has a long way to go to catch up.
The Current Usage of PYUSD
According to DefiLlama, PayPal has currently minted 42.3 million PYUSD tokens on the Ethereum blockchain, each with a value of $42.3 million. However, only $4.5 million (10.6% of the total) has been put into circulation. The remaining $37.8 million is still held by PayPal’s partner, Paxos, who issues the tokens on behalf of PayPal. Etherscan reveals that there are only 299 individual wallets holding the PYUSD tokens.
Availability on Exchanges
Although Coinbase offers the token on Coinbase Wallet, the trading volume of PYUSD remains low. Bitmart and UniSwap are among the few exchanges where PYUSD can be traded, and as reported by Blockworks, only 7% of all PYUSD is currently held on exchanges.
- Advertisement -
The Challenges for PayPal
Despite its large user base, PayPal struggles to popularize the PYUSD stablecoin. The recent integration of a crypto exchange on the PayPal platform allows users to buy cryptocurrencies, and for many users in the United States, this includes the option to purchase with PYUSD. However, the token has yet to gain widespread adoption.
Competition in the Stablecoin Market
Bank of America analysts have previously predicted challenges for PayPal’s stablecoin, not only from other stablecoins but also from future digital currencies like the potential Central Bank Digital Currency (CBDC) of the United States. This competition further complicates PayPal’s path to adoption.
In conclusion, while PayPal’s foray into the crypto market with the PYUSD stablecoin initially appeared promising, the current data indicates a lack of adoption. Despite having access to a substantial user base, PayPal faces significant competition and struggles to compete with established stablecoin issuers. As the crypto space continues to evolve, PayPal will need to find new strategies to increase the usage and popularity of its stablecoin.