Crypto news

Early adoption poses challenges for PayPal’s PYUSD.

PayPal’s newly launched stablecoin, PayPal USD (PYUSD), is encountering difficulties in gaining widespread adoption,

as indicated by on-chain data.

Analysis from blockchain analytics firm Nansen reveals that approximately 90% of PayPal USD is currently held in wallets controlled by Paxos Trust, the issuer of the stablecoin.

The report further highlights that crypto exchange wallets, including Kraken, Gate.io, and Crypto.com,

account for nearly 7% of the total supply of PayPal USD.

However, uptake among “smart money” investors, referring to well-informed or professional investors, remains minimal.

Despite the initial excitement surrounding PayPal’s stablecoin launch in early August,

the anticipated surge in adoption and mass introduction to cryptocurrencies has yet to materialize.

While PayPal boasts a user base of over 350 million globally, only a small number of users have actually engaged with the stablecoin or chosen to store it in self-custody wallets during the initial weeks following its debut.

The report reveals that the figures present a concerning picture:

“On the surface there’s a lack of demand from crypto users for PYUSD when other alternatives exist (might be due to Paypal targeting a different demographic).”

Insights from Recent Data: PayPal’s PYUSD Stablecoin Faces Early Adoption Challenges in Decentralized Exchanges

Recent data reveals noteworthy insights about PYUSD, PayPal’s stablecoin, in the decentralized exchange landscape.

Pools on platforms like Uniswap, such as PYUSD/wETH and PYUSD/USDC,

currently hold fewer than 50,000 tokens.

Analysis of the largest individual holders, excluding exchanges and contracts, indicates a moderate level of interest,

with the top holder owning less than $10,000 worth of PYUSD.

Interestingly, this holder acquired the stablecoin after selling three memecoins.

Furthermore, the data indicates that fewer than 10 holders, excluding exchanges and contracts, possess a balance exceeding $1,000 in PYUSD.

It is important to note that PYUSD has only been circulating for less than three weeks, having been launched without prior announcement of its development.

PYUSD, which is issued by Paxos Trust Co., is an Ethereum-based stablecoin pegged to the U.S. dollar.

It is fully backed by deposits in dollars, short-term Treasurys, and similar cash equivalents.

Its release sparked a competitive race among established crypto players.

In response, Circle, the company behind USD Coin (USDC), recently announced its expansion to six blockchains, aiming to enhance adoption by making the stablecoin available on 15 networks.

At the time of writing, CoinMarketCap data shows USDC with a market capitalization of around $25 billion, while Tether maintains a market capitalization of over $82 billion.

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