PayPal Launches PYUSDx for Custom Stablecoin Issuance

Stablecoins were once issued mainly by crypto-native companies, but traditional financial institutions and technology giants are accelerating their push into the market as demand for digital assets and cross-border payments grows. Stablecoins launched by PayPal and major banks can reduce transaction costs and improve settlement efficiency, while signaling deeper integration between decentralized finance and the traditional financial system. The shift could reshape global payment rails and expose incumbent issuers to formidable competition from traditional finance.

PayPal deployed its PYUSD stablecoin on the Polygon network in July 2026 to lower cross-border payment fees and broaden its use. Meanwhile, more than 140 financial institutions, including Visa, BlackRock and BNY, plan to launch a shared stablecoin called OpenUSD by the end of 2026. The initiative shows traditional banks moving faster to capture a share of the crypto market and is set to put significant competitive pressure on existing issuers.

PayPal launched its U.S. dollar stablecoin, PayPal USD (PYUSD), in August 2023. Issued by Paxos Trust, it is backed by assets including U.S. dollar deposits and short-term U.S. Treasuries. PYUSD is designed to reduce reliance on traditional banking intermediaries, accelerate cross-border payments and merchant settlement, and lower transfer costs.

PayPal most recently announced that it was expanding PYUSD services to 70 markets worldwide, including Singapore, Colombia and other markets across Latin America and the Asia-Pacific region. Eligible users can buy, sell, hold and send PYUSD across borders directly through their PayPal accounts, while merchants can use the stablecoin for near-instant settlement. Some markets also allow users to earn rewards on their PYUSD holdings.

PayPal launched its US dollar stablecoin, PayPal USD (PYUSD), in August 2023. Issued by Paxos Trust Company, it is fully backed by US dollar deposits, US Treasuries and cash equivalents and can be redeemed at a rate of 1 PYUSD to $1. PYUSDx extends this regulated underlying asset to the application layer, allowing businesses to avoid rebuilding stablecoin infrastructure themselves.

On February 27, 2026, MoonPay, M0 and PayPal launched PYUSDx, combining MoonPay's issuance capabilities with M0's cross-chain technology. The platform allows developers to launch application-specific stablecoins backed by PYUSD within days. The number of new stablecoins with more than $10 million in supply rose 89% in 2025, and USD.ai has become the platform's first adopter.