The payments giant PayPal recently took the next step on the road to achieving greater crypto adoption by using its proprietary stablecoin, PYUSD, to pay invoices.
In the first-ever use of PYUSD in this way, PayPal paid Ernst & Young using its stablecoin. The payment went through SAP’s digital currency hub, which carried out the transaction.
PayPal Takes The Next Step With Its Stablecoin Usage
Of course, PayPal used its stablecoin in the past. After launching it in 2023, the company made multiple investments in other firms using PYUSD. The latest example of this was only last month when PayPal used the stablecoin to make an investment in blockchain risk management specialist Chaos Labs.
But, this was the first time that the company tapped the token to pay a bill. Its Senior Vice President of Blockchain, Crypto, and Digital Currency Group, Jose Fernandez da Ponte, commented on the move by saying that B2B transactions — particularly international ones — can be slow and too expensive.
However, PayPal found that it could perform them much faster and at the lowest cost if it used a stablecoin as an alternative. Stablecoins’ price is not affected by the crypto volatility, so they do not have the greatest disadvantage that typically comes with using cryptos as a means of payment.
However, they keep all of the advantages of digital currencies, such as near-instant transfers and fees that are often so low that they are negligible. Commenting further, the firm’s SVP said that the enterprise environment is very well suited for stablecoin payments. “It’s a very rational conversation to have with the CFO,” he added.
Fintech Firms Are Getting More Involved With Stablecoins
PayPal’s decision to expand on its stablecoin usage comes at a time when stablecoins started growing in prominence in the FinTech world. Fintechs around the world have noticed the same benefits as PayPal, including the lack of volatility thanks to the fact that they are backed by real-world assets, and their efficiency in terms of speed and low cost.
One of the firms that stood out recently is the UK’s Revolut, which is reportedly working on creating its own stablecoin. As for PYUSD, it is currently one of the largest stablecoins in the world, with a market cap of over $729 million as of Monday, October 7.
In the crypto industry, there are only three stablecoins with a larger market cap, including First Digital USD with a market cap of $2.6 billion, USDC with a market cap of $35.5 billion, and Tether, with a market cap of $119.6 billion.