PayPal's PYUSD Stablecoin Market Cap Crosses $1B, Matching Its All-Time High

PayPal's U.S. dollar-backed stablecoin, PYUSD, has returned to the spotlight after its market capitalization crossed the $1 billion threshold – matching its all-time high first reached in August 2024.

PayPal’s U.S. dollar-backed stablecoin, PYUSD, has returned to the $1 billion market capitalization threshold, a milestone last seen in August 2024.

The stablecoin’s circulating supply is now sitting at around $1.01 billion, more than double the local low of $498 million reached at the start of 2025.

According to DeFiLlama, $PYUSD is now the 10th largest stablecoin by market cap as of June 2025.

This suggests a more sustainable trajectory for PYUSD compared to last year, where rapid growth was partly fueled by ecosystem incentives within the Solana decentralized finance (DeFi) domain.

At the time, DeFi protocols on Solana were offering generous rewards for PYUSD usage, which in turn drove up demand for the stablecoin on that chain. The frenzy briefly led to a surprising milestone: for a short period in August 2024, more $PYUSD was circulating on Solana than on Ethereum, the dominant blockchain for stablecoins.

Although Ethereum remains the primary home for stablecoin assets under management (AUM) – currently holding over $125 billion – Solana trails behind with around $11 billion.

But PYUSD’s renewed ascent in 2025 appears less dependent on ecosystem incentives, and more on strategic growth initiatives from PayPal and its issuer, Paxos Trust Company.

Launched in August 2023, PYUSD is a fully collateralized stablecoin that is pegged 1:1 to the U.S. dollar. Issued by Paxos and regulated by the New York State Department of Financial Services (NYDFS), PYUSD is backed by dollar deposits, U.S. Treasury bills, and other cash equivalents. Paxos also publishes monthly attestations, offering transparency and compliance with U.S. regulatory standards.

An ERC-20 token issued on the Ethereum blockchain, PayPal USD will be available to an already large and growing community of external developers, wallets and web3 platforms.

The stablecoin is also issued on Solana as an SPL token, giving users access to high-speed, low-cost transactions across two leading smart contract platforms. It is deeply integrated into PayPal’s platform, where users can buy, sell, hold, and transfer PYUSD seamlessly – often with zero fees for in-network transactions. The stablecoin can also be used for merchant checkout and peer-to-peer payments within PayPal’s massive user base of over 400 million.

Beyond consumer use, PYUSD is making inroads in the business and institutional payments domain. In September 2024, PayPal completed its first corporate transaction using PYUSD, when Ernst & Young processed a cross-border payment through SAP’s blockchain-enabled enterprise system. This move highlighted the growing role of stablecoins in digitizing B2B payments traditionally dominated by SWIFT and legacy banking rails.

To encourage broader adoption, PayPal began offering a 3.7% annual yield on PYUSD balances in early 2025, paid out monthly to eligible U.S. users. This yield feature positions PYUSD as a competitive stablecoin for both retail savers and DeFi participants, adding a new layer of utility beyond just payments.

Meanwhile, exchanges like Coinbase have joined the push, allowing users to trade PYUSD with zero fees and enabling seamless USD redemption – putting PYUSD in direct competition with incumbents like Circle’s USDC and Tether’s USDT.

PYUSD’s return to the $1 billion milestone also comes as stablecoins increasingly assert themselves as foundational products in crypto finance. The total market capitalization of all stablecoins now exceeds $238 billion, a testament to their growing use in trading, payments, and as on-chain cash equivalents.