TLDR
- PayPal aims to have 20 million merchants using its PYUSD stablecoin by the end of 2025
- PYUSD will be integrated into PayPal’s bill-pay product for merchant payments to vendors in 2025
- Cross-border payments are a key focus for PYUSD to reduce friction and transaction times
- PayPal plans to implement PYUSD as a direct payment option on Hyperwallet by Q2
- The company has set a target to grow its earnings 20% by 2027
PayPal is pushing forward with plans to expand the utility of its U.S. dollar-pegged stablecoin PYUSD, aiming to bring 20 million merchants into its ecosystem by the end of 2025.
The company shared these updates during its investor day in New York, where executives outlined how the stablecoin is moving beyond its experimental phase.
Currently, PYUSD has a market cap of just over $700 million and has mainly been used within crypto circles despite being available through the PayPal app and Venmo. The payments giant now wants to change this by bringing the stablecoin into mainstream business applications.
One of PayPal’s first initiatives is to offer PYUSD as an option for merchants to pay vendors through its bill-pay product. This feature isn’t available yet but is expected to launch later this year. According to reports from Bloomberg and Fortune, the approach would allow merchants to “invite” vendors into the PayPal network for transactions.
“The thesis was: Can we facilitate that on PYUSD rails so as not to have the currency conversion, the friction, as well as time?”
said Michelle Gill, general manager of PayPal’s small and medium enterprises line of business, in an interview with Bloomberg.
Cross-border payments represent another key focus for PayPal’s stablecoin strategy. The company aims to address the needs of U.S. merchants when making payments to international vendors and suppliers. By using PYUSD, PayPal hopes to reduce friction from currency conversion and cut down transaction times.
PYUSD Milestone
Last year marked an important milestone as PayPal completed its first PYUSD business transaction, just one year after announcing plans for the stablecoin. These developments come as stablecoin legislation in the U.S. appears to be gaining clarity, with observers noting that clearer regulations could lead to thousands more entrants in this space.
PayPal CEO Alex Chriss emphasized during the investor event that while the company is still viewed as “these pieces of either acquisitions or products or things that we’ve done over the past,” they are working on “actually bringing it together.” This integration effort reflects PayPal’s broader strategy to create a more unified and seamless experience across its various products.
Beyond merchant payments, PayPal is looking to expand its Hyperwallet platform, which it acquired in 2018 for $400 million. Hyperwallet facilitates mass payments to contractors, freelancers, and sellers worldwide. PayPal plans to make PYUSD a direct payment option on this platform before the end of the second quarter.
The mass payout functionality mirrors similar use cases implemented by Bridge, a stablecoin infrastructure recently acquired by Stripe. Bridge secured U.S. Aid as one of its earliest customers, helping to process thousands of international payments.
In line with these expansion plans, PayPal has set an ambitious target to grow its earnings 20% by 2027. Following the investor day announcements, PayPal’s stock (PYPL) rose 4.7% in pre-market trading, reaching $77.57 from the previous close of $74.07.
