PayPal's Stablecoin PYUSD Faces Decline Despite Market Upsurge, Retains Strong Position
Summary:
In March, PayPal USD(PYUSD), a stablecoin by PayPal and Paxos, experienced a substantial decrease in circulation. Despite this and the cryptocurrency market's upswing, its market capitalization has continued to fall since February's all-time high. However, the stablecoin's market value has seen some growth and is backed by U.S. dollar deposits and short-term Treasurys. Eight months post-launch, PYUSD is viewed as a major stablecoin surpassing others in market capitalization.
PayPal USD (PYUSD), a stablecoin developed by payment behemoth PayPal and digital currency enterprise Paxos, experienced a considerable decline in circulation in March. The latest PayPal USD clarity report by Paxos reveals that in March, PYUSD circulation was at $188.5 million, marking a 39% decrease from February. Circulation figures for February and January were $304 million and $301 million correspondingly. As of March 29, U.S. Treasury bonds worth $14.9 million were accounted for in the PayPal USD treasury, having a presumed value of nearly $14.8 million. The present market worth of PYUSD collateral in the reverse repurchase agreements using U.S. Treasury bond as collateral is $177.9 million and its assumed value is $174 million. The total net assets stand at $192 million, with an assumed value of $189 million. The market capitalization of PayPal USD has been on a downward trend since late February after it hit an all-time high of $312 million on February 26, as per CoinGecko data. The stablecoin experienced speedy growth in early 2024, its market value doubled in just one month by mid-January. Currently, the market capitalization of PYUSD is $194 million, a 3% increment in the last seven days. This decrease in PYUSD circulation took place despite an upturn in the cryptocurrency market, with Bitcoin (BTC) setting new records above $73,000 on March 13. Paxos is yet to respond to Cointelegraph's inquiry concerning the PYUSD circulation drop. PayPal USD stablecoin was launched by PayPal in partnership with the Paxos Trust in August 2023 and is projected as a digital payment and Web3 solution. Following the 1:1 ratio with the U.S. dollar, PYUSD is backed by U.S. dollar deposits, short-term Treasurys, and other cash equivalents. Just eight months after its launch, PYUSD has become a leading stablecoin, outperforming Paxos' Pax Dollar (USDP) and Gemini Dollar (GUSD) and ranking 13th in market capitalization. The market value of PYUSD is just 0.18% of the Tether (USDT) stablecoin, which currently has a market value of $106.6 billion. The combined market capitalization of all stablecoins is $155 billion at the time of publishing.
Published At
4/8/2024 12:44:08 PM
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