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PayPal’s PYUSD stablecoin has surged from $1.2 billion in September to approximately $3.8 billion in early December—a 217% increase driven by multichain expansion and integration with the company’s 400 million-user payment network.
The growth, confirmed by on-chain data, positions PYUSD among the fastest-growing stablecoins despite regulatory uncertainty. The token currently offers a 3.7% annual yield, a feature that appears to conflict with the GENIUS Act signed into law in July, which explicitly prohibits yield-bearing stablecoins.
The most influential catalyst behind the Pyusd stablecoin surge is PayPal’s September integration with LayerZero, a move that expanded PYUSD to nine additional blockchains, including Avalanche, Aptos, Tron, Sei, Abstract, and others. The integration also upgraded its deployment on Flow and Berachain, enhancing interoperability.
This multichain expansion dramatically widened user access. Through PayPal and Venmo, PYUSD now reaches more than 400 million active users, an advantage few stablecoins possess. This accessibility played a central role in the Pyusd stablecoin surge, as PYUSD’s supply jumped by approximately 113% in November alone, alongside a 150% increase in monthly transactions reaching 1.8 million.
The LayerZero rollout allowed PYUSD to move beyond a single-chain model and operate as a functional bridge between traditional finance and decentralized finance. For millions of users already trusting PayPal for payments, the stablecoin’s extended availability helped cement its position as a natural entry point into Web3 services.
Market data shows the broader stablecoin sector holding a combined capitalization of about $307.2 billion. Tether’s USDT leads with $184.6 billion, while Circle’s USDC sits at $77.3 billion. Against this backdrop, the Pyusd stablecoin surge stands out as a rare instance of rapid upward movement in an otherwise mature market dominated by two long-standing incumbents.
The Pyusd stablecoin surge has also drawn attention for another reason: PYUSD currently offers a 3.7% annual yield on balances. This feature places the token at the center of a regulatory conversation because the GENIUS Act — signed into law in July — explicitly prohibits yield-bearing stablecoins.
Under the GENIUS Act, approved issuers must be insured depository institutions, bank subsidiaries, or vetted non-bank financial entities. They are also required to maintain a 1:1 reserve ratio and are barred from offering yield or interest to token holders.
The contradiction has raised concerns about how PayPal will reconcile PYUSD’s existing structure with federal law. So far, the company has not issued a public clarification.
Despite navigating these regulatory uncertainties, the Pyusd stablecoin surge demonstrates PYUSD’s growing role in PayPal’s broader strategy. The firm, a leading global payment provider, is leveraging the token to enhance customer engagement at a time when its stock performance faces pressure. At the time of reporting, PayPal shares were down 26.30% year-to-date, trading around $62.90 on Nasdaq.
The Pyusd stablecoin surge also coincides with a rebound across the wider crypto market. Bitcoin and Ethereum, which had dipped to recent lows, climbed approximately 7% over the past 24 hours. BTC traded near $92,878, while ETH hovered around $3,052.
These market conditions support the Pyusd stablecoin surge, as rising liquidity and user activity often stimulate stablecoin demand. Yet, PYUSD’s growth remains particularly notable because it stems not from speculative cycles but from PayPal’s extensive distribution network and its newly expanded blockchain footprint.
As regulatory clarity evolves and market forces continue to shift, stakeholders will closely watch whether the Pyusd stablecoin surge can be sustained — and how PayPal will navigate the compliance challenges tied to the GENIUS Act.
