What is PayPal USD?

PayPal USD (PYUSD) is a stablecoin, a type of cryptocurrency that strives to maintain a steady value over time relative to a reference asset, in this case, the U.S. dollar. PYUSD is fully backed by U.S. dollar deposits, short-term U.S. Treasuries, and similar cash equivalents. This means that each PYUSD token aims to be redeemable 1:1 for U.S. dollars. The issuance and custody of PayPal USD is performed by Paxos Trust Company, a regulated financial institution. PYUSD is designed to contribute to the potential that stablecoins offer for payments, providing inclusive, broad access to the financial system, and enabling fast and efficient money movement.

How does PayPal USD work?

PayPal USD operates as a stablecoin, meaning it strives to maintain a stable value relative to the U.S. dollar. This is achieved by backing each PYUSD token with U.S. dollar deposits, short-term U.S. Treasuries, and similar cash equivalents. Users have the ability to acquire, hold, and transfer PayPal USD within the PayPal app or on the PayPal site. Additionally, PYUSD can be sent to friends in the U.S. on PayPal without fees, or to wallet addresses that accept PYUSD. Users can also use PYUSD to facilitate purchases by selecting it at checkout, and convert any of PayPal's supported cryptocurrencies to and from PayPal USD.

What are the potential use cases for PayPal USD?

PayPal USD seeks to provide a digital currency that can be built into public blockchains, linking the traditional economy and Web3. This makes it a useful tool for developers who aim to use PayPal USD as the payments layer to build new services and products on public blockchains. PYUSD is initially built on a blockchain known for its programmability, and is compatible with various exchanges, wallets, and dApps. Furthermore, PYUSD can be used for person-to-person payments, facilitating purchases, and converting to and from other supported cryptocurrencies.

What is the history of PayPal USD?

PayPal USD was introduced as a new cryptocurrency on August 7, 2023. It was designed to contribute to the potential that stablecoins offer for payments and is fully backed by U.S. dollar deposits, short-term U.S. Treasuries, and similar cash equivalents. The issuance and custody of PayPal USD is performed by Paxos Trust Company. Since its introduction, PayPal USD has been made available to eligible U.S. PayPal customers, allowing them to transfer PYUSD between PayPal and compatible external wallets, send person-to-person payments using PYUSD, facilitate purchases with PYUSD, and convert any of PayPal's supported cryptocurrencies to and from PayPal USD.