What is PYUSD (PayPal USD)

PayPal USD (PYUSD) is a fiat-backed stablecoin issued by Paxos Trust Company and branded by PayPal, designed to maintain a 1:1 peg with the US dollar. It is fully backed by US dollar deposits, short-term US Treasuries, and similar cash equivalents, with reserves independently attested on a monthly basis. PYUSD was launched in August 2023, making it one of the first stablecoins issued in direct partnership with a major consumer payments company.

For fintechs evaluating stablecoin infrastructure, PYUSD sits in the same category as USDC and USDT as a regulated, dollar-pegged asset, but with a distribution angle tied to PayPal and Venmo's existing user base.

How PYUSD works

PYUSD is issued by Paxos Trust Company, a New York-regulated trust company that also issues USDP (Paxos Dollar). The issuer model matters for compliance: because Paxos holds the reserves and issues the token, it is the regulated entity responsible for redemption. PayPal licenses the PYUSD brand and distributes it through its platforms.

Reserve backing is published monthly through attestation reports from KPMG LLP, an independent accounting firm appointed with approval from the New York State Department of Financial Services. Paxos also self-reports reserve composition five business days after each month-end; these self-reports are not independently reviewed. Both reports are publicly available at paxos.com/pyusd-transparency.

Blockchain support

PYUSD launched on Ethereum as an ERC-20 token in August 2023. In May 2024, PayPal expanded PYUSD to the Solana network, citing lower transaction fees and faster confirmation times. In July 2025, PYUSD launched on Arbitrum, its first Layer 2 deployment, offering Ethereum compatibility at lower cost and higher throughput. PayPal has continued expanding to additional networks; as of early 2026, PYUSD is available across more than a dozen blockchains.

The Ethereum version is a standard ERC-20 token, compatible with the broad ecosystem of Ethereum Virtual Machine wallets, decentralized exchanges, and DeFi protocols. The Solana version uses the SPL token standard. The Arbitrum deployment shares Ethereum tooling and smart contract compatibility, allowing developers to migrate applications from Ethereum mainnet without rewriting code.

Supply and circulation

PYUSD has a circulating supply of approximately 4.07 billion tokens, giving it a market cap of roughly $4.07 billion as of March 2026 (CoinMarketCap).

PYUSD holds approximately 1.4% of the total stablecoin market. It remains significantly smaller than the two dominant stablecoins: USDT accounts for roughly 62.5% of the market with a supply of approximately $183.5 billion, while USDC holds the second-largest share at around 25.5%. The total stablecoin market cap sits at approximately $314 billion as of March 2026 (DefiLlama).

PYUSD vs. other major stablecoins

All three major dollar stablecoins, USDT, USDC, and PYUSD, maintain a 1:1 USD peg and are backed by cash and cash-equivalent reserves. The differences lie in issuer structure, regulatory positioning, reserve transparency, and distribution.

• Issuer: PYUSD is issued by Paxos (regulated by NYDFS). USDC is issued by Circle. USDT is issued by Tether Limited.
• Reserve attestations: PYUSD and USDC publish regular third-party attestations. Tether publishes quarterly reserve reports.
• Distribution advantage: PYUSD benefits from direct integration into PayPal and Venmo, giving it consumer distribution that USDC and USDT do not have natively.
• DeFi liquidity: USDT and USDC have substantially deeper liquidity across decentralized exchanges and lending protocols compared to PYUSD.
• Blockchain availability: USDT and USDC are available across many more chains than PYUSD.

For a detailed comparison of the two dominant stablecoins, see our guide to USDT vs. USDC.

Regulatory context

PYUSD sits within an evolving regulatory environment for stablecoins. Because Paxos operates as a New York-chartered trust company under the supervision of the New York Department of Financial Services (NYDFS), PYUSD is one of the more regulated stablecoins currently in circulation.

In the US, the GENIUS Act is the primary proposed federal framework for payment stablecoin oversight, and would establish reserve, redemption, and disclosure requirements for issuers like Paxos. For a full breakdown of what that legislation means for stablecoin issuers and the businesses that use them, see our guide to the GENIUS Act and US stablecoin regulation.

What PYUSD means for fintech infrastructure

PYUSD's primary relevance for fintechs is as an additional stablecoin option for cross-border settlement, particularly for use cases that already intersect with PayPal's ecosystem. Key considerations when evaluating PYUSD alongside other stablecoins include:

• Liquidity depth: For high-volume corridors, available liquidity on-chain matters. PYUSD's on-chain liquidity is currently much lower than USDT or USDC.
• Counterparty familiarity: In markets where PayPal has strong consumer penetration, PYUSD may be more recognizable to end users than other stablecoins.
• Redemption infrastructure: Redemption goes through Paxos, which requires a business account. Evaluate whether your existing stablecoin custody and redemption setup supports PYUSD.
• Network coverage: If your payment flows require chains beyond Ethereum and Solana, PYUSD's current network support is more limited than alternatives.

To understand how stablecoins fit into cross-border payment infrastructure more broadly, see our guide to stablecoins in cross-border payments.