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PayPal deployed PYUSD on Solana earlier in the year, and the executive just revealed why.
Key Notes
Solana’s technological advances and low cost have continued to attract mainstream integration.The PayPal executive names this as one key reason PYUSD was deployed on Solana.Solana is now competing with Ethereum for PYUSD volume.José Fernández, the head of CBDC at PayPal Holdings Inc (NASDAQ: PYPL), has revealed why the payment company launched the PYUSD PYUSD $1.00 24h volatility: -0.3% Market cap: $733.70 M Vol. 24h: $66.37 M stablecoin on Solana SOL $150.7 24h volatility: 7.1% Market cap: $70.64 B Vol. 24h: $4.17 B even though it was already on Ethereum. In his opinion, Ethereum ETH $2 545 24h volatility: 4.0% Market cap: $306.59 B Vol. 24h: $19.61 B is not the best solution for payments. He clarified that Solana offers top features, including token extensions and lower costs, making it a perfect fit.
Choosing Solana in Addition to Ethereum
Solana can process 1,000 transactions per second, ideal for mainstream adoption. Blockchain analytics platform Artemis even pointed out that Solana has emerged as the leading blockchain for running tokenized transactions. The Proof-of-Stake protocol is ideal for PYUSD as it continues to gain traction in payments and settlement businesses.
To a large extent, Solana is recognized for processing transactions at higher speeds and lower costs than Ethereum, even though they both utilize the Proof-of-Stake consensus mechanism. This efficiency makes it more appealing to users who are in search of faster transactions with minimal fees.
“Making PYUSD available on the Solana blockchain furthers our goal of enabling a digital currency with a stable value designed for commerce and payments,” José Fernández once said.
During Consensus 2024 in May, PayPal revealed PYUSD’s availability on the Solana blockchain. The firm saw it as a viable avenue to provide users with multiple blockchain options, allowing for increased flexibility and control. It was also a strategy to expand its business offerings and deepen its presence within the crypto ecosystem. At the time, Sheraz Shere, GM of payments at Solana, noted that, “The Solana network’s speed and scalability make it the ideal blockchain for new payment solutions that are accessible, cost-effective, and instantaneous.”
Aftermath of PYUSD Integration on Solana
Following PYUSD’s launch on the Solana blockchain, the stablecoin has gained more massive adoption.
Many Solana-based Decentralized Exchanges (DEXes) like Jupiter and Orca have added the stablecoin to their pools. Last month, the cryptocurrency exchange Bitget announced that it has added support for PayPal’s PYUSD stablecoin on the Solana blockchain, extending the digital asset to a broader range of users.
PYUSD on Solana has continued to experience a rapid increase in the actual amount locked. In July, DefiLlama data revealed that Solana-based PYUSD stablecoins saw a 230% increase in their total circulating supply in 30 days. Since its debut on May 29, the token had an initial supply of nearly $252 million.
By August, Solana had successfully overtaken Ethereum in terms of PYUSD volume. According to Dune Analytics data, Solana-based PYUSD was around 377 million, while Ethereum-based PYUSD was at 356 million. Generally, PayPal’s PYUSD supply in the market has increased in the last year.
It is unknown if PYUSD will soon expand to another blockchain, but such integrations usually offer users the flexibility of choosing between multiple protocols. In the long run, this helps them gain greater control over their transactions and might help PayPal in its push toward gaining more stablecoin dominance.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
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Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
