What could affect the price of PYUSD?
PYUSD’s dollar peg is under pressure from factors like adoption growth, regulatory challenges, and operational issues.
- Multi-Chain Expansion – Connecting PYUSD to multiple blockchains could increase its usefulness (positive).
- Regulatory Scrutiny – New rules from the GENIUS Act may slow down operations (negative).
- Operational Risks – Technical mistakes could damage trust in PYUSD’s backing (negative).
Deep Dive
1. Multi-Chain Expansion (Positive Impact)
Overview: PYUSD is now available on nine different blockchains, including Arbitrum, Solana, and Tron, thanks to LayerZero’s OFT standard. This allows users to swap PYUSD across different blockchain networks and use it in decentralized finance (DeFi) applications. This move supports PayPal’s goal to have 20 million merchants using PYUSD by 2025 (CoinDesk).
What this means: Making PYUSD accessible on multiple blockchains can increase its use for payments and DeFi, which could boost demand. For example, B2C2 offers zero-fee swaps on PENNY stablecoin with $1 billion in daily volume, improving liquidity and helping maintain PYUSD’s dollar peg.
2. Regulatory Risks (Negative Impact)
Overview: The GENIUS Act requires stablecoin issuers with over $50 billion in market cap to hold 100% reserves and undergo regular audits. Senator Elizabeth Warren has criticized the current consumer protections, pointing to a recent $300 trillion minting error by Paxos as a warning (The Block).
What this means: Increased regulatory oversight could slow PYUSD’s growth, especially if audits find problems with reserve management. Political concerns related to issuers connected to former President Trump add uncertainty, which might make institutional users hesitant.
3. Operational Risks (Negative Impact)
Overview: On October 16, Paxos accidentally minted 300 trillion PYUSD tokens due to a manual error, though the tokens were burned within 24 minutes (Decrypt).
What this means: Even though the issue was quickly fixed, such mistakes can hurt confidence in PYUSD’s stability. For example, the DeFi platform Aave temporarily froze PYUSD markets after the incident, showing how sensitive decentralized finance is to the reliability of stablecoins.
Conclusion
PYUSD’s ability to maintain its dollar peg depends on balancing growth opportunities with regulatory and technical challenges. Expanding into DeFi and merchant networks offers potential for increased use, but ongoing operational errors or tough regulations could raise concerns about PYUSD losing its peg. The key question: Will PayPal’s merchant adoption outpace competitors like USDC in the fourth quarter?
What are people saying about PYUSD?
PYUSD’s week has been a rollercoaster, swinging between a massive minting error and exciting new partnerships. Here’s what’s making headlines:
- A $300 trillion minting glitch raises trust issues
- Integration with TRON boosts hopes for decentralized finance (DeFi)
- A new rewards program aims to keep users engaged
In-Depth Look
1. @0xRexster: $300T PYUSD mint/burn causes alarm (negative)
“Regulated stablecoin issuer #Paxos accidentally minted 300 trillion $PYUSD [...] then burned all 300 trillion PYUSD 22 minutes later.”
– @0xRexster (58K followers · 1.2M impressions · 2025-10-16 05:50 UTC)
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What this means: This incident is a red flag for PYUSD because it revealed weaknesses in Paxos’ controls. Even though the mistake was quickly fixed, it raises concerns about the safety and reliability of centralized stablecoins like PYUSD.
2. @MR_0FFICIALL: TRON integration through LayerZero (positive)
“PYUSD0 live on TRON [...] expanding real-world payments into borderless DeFi networks.”
– @MR_0FFICIALL (212K followers · 890K impressions · 2025-09-19 22:53 UTC)
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What this means: This is good news for PYUSD. TRON handles over half of all stablecoin transactions worldwide, so this partnership could help PYUSD grow in emerging markets and make cross-border payments easier and cheaper.
3. CoinMarketCap Community: PYUSD rewards program (positive)
“Holders with ≥1.0 PYUSD earn daily rewards [...] credited monthly via Cryptocurrencies Hub.”
– CoinMarketCap Community Post (2025-07-16 09:48 UTC)
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What this means: This rewards program encourages users to hold onto PYUSD longer. With PayPal and Venmo’s combined 434 million users, this could help stabilize demand and make PYUSD more competitive against other popular stablecoins like USDT and USDC.
Conclusion
The outlook for PYUSD is mixed. On one hand, the $300 trillion minting error highlights operational risks. On the other, partnerships like TRON integration and the rewards program show strong efforts to grow adoption. Despite the hiccup, PayPal’s strategy to connect traditional finance with decentralized finance gives PYUSD a promising role. Keep an eye on the circulating supply (currently $2.76 billion) as a sign of how well PYUSD is being adopted by everyday users and businesses after the rewards program launches.
What is the latest news about PYUSD?
PayPal USD (PYUSD) is navigating regulatory challenges and expanding its use, even after a major $300 trillion minting mistake. Here’s the latest:
- $300T Minting Mistake Raises Transparency Questions (Oct 23, 2025) – Paxos accidentally created PYUSD tokens worth 2.5 times the world’s GDP, then quickly destroyed them.
- B2C2 Adds PYUSD Support on PENNY Platform (Oct 23, 2025) – Institutional users can now swap PYUSD with other stablecoins instantly and without fees.
- Senator Warren Calls for Stronger Stablecoin Rules (Oct 22, 2025) – She urges tighter oversight after the Paxos error, highlighting gaps in current laws.
In-Depth Look
1. $300T Minting Mistake Raises Transparency Questions (Oct 23, 2025)
What happened:
Paxos accidentally minted $300 trillion worth of PYUSD due to a manual error during their cold storage process. These extra tokens were caught and destroyed within 24 minutes, never leaving Paxos’ control. Paxos CEO Charles Cascarilla described this as a win for blockchain transparency, but some critics worry about Paxos’ reliability as it seeks federal banking approval.
Why it matters:
This mistake shows the risks involved in issuing stablecoins but also highlights how blockchain technology can quickly detect and fix errors. Although no money was lost, this incident might slow down Paxos’ regulatory approvals and shake some institutional trust in PYUSD’s system. (Decrypt)
2. B2C2 Adds PYUSD Support on PENNY Platform (Oct 23, 2025)
What happened:
B2C2, a major liquidity provider, launched PENNY—a platform that allows banks, exchanges, and payment processors to swap PYUSD with other stablecoins instantly and without fees. PENNY supports multiple blockchain networks like Ethereum, Solana, and Layer 2 solutions, handling about $1 billion in stablecoin volume daily.
Why it matters:
Adding PYUSD to PENNY shows growing demand from traditional financial institutions for compliant stablecoins in cross-border payments. PENNY’s multi-chain support could increase PYUSD’s liquidity and encourage more adoption by mainstream finance players looking for faster, cheaper transactions. (CoinDesk)
3. Senator Warren Calls for Stronger Stablecoin Rules (Oct 22, 2025)
What happened:
Senator Elizabeth Warren criticized the GENIUS Act, a recent stablecoin law, saying it doesn’t do enough to protect consumers or prevent money laundering. She pointed to the Paxos incident as proof that more oversight is needed, especially concerning conflicts of interest involving stablecoin issuers linked to former President Trump’s associates.
Why it matters:
Warren’s call for stricter rules reflects growing political pressure to regulate stablecoins more tightly. If her proposals pass, PYUSD issuers might face tougher audits, stronger guarantees for redeeming tokens, and higher accountability. This could slow PYUSD’s growth but build greater trust over time. (The Block)
Conclusion
PYUSD is at a crossroads, balancing growing use by institutions with increasing regulatory scrutiny. Partnerships like B2C2’s PENNY platform show PYUSD’s expanding role, but the Paxos minting error reveals weaknesses in current systems. The question remains: will stronger oversight help stabilize PYUSD’s growth or limit its ability to compete with other stablecoins like USDC?
What is expected in the development of PYUSD?
PayPal USD’s (PYUSD) plan focuses on making the coin more useful and easier to use across different blockchain networks.
- Cross-Chain Expansion with LayerZero (Q4 2025) – Introducing PYUSD0, a new version that works across nine different blockchains without restrictions.
- TRON Network Integration (September 19, 2025) – Using TRON’s fast and low-cost network to improve global payments.
- Merchant Crypto Payments (September 15, 2025) – Allowing U.S. merchants to accept over 100 cryptocurrencies, including PYUSD, for payments.
Deep Dive
1. Cross-Chain Expansion with LayerZero (Q4 2025)
What’s happening: PayPal is teaming up with LayerZero to launch PYUSD0, a version of PYUSD that anyone can use freely across multiple blockchains like Abstract, Aptos, Avalanche, Ink, Sei, Stable, and TRON (source). Tokens already bridged on Berachain and Flow will upgrade to this new version, making it easier to move PYUSD between different blockchain networks.
Why it matters: This makes PYUSD more accessible in decentralized finance (DeFi), which could increase how much people use and trade it. However, there are risks like software bugs or security issues with the bridges that connect blockchains, which could slow down adoption.
2. TRON Network Integration (September 19, 2025)
What’s happening: PYUSD is now available on the TRON blockchain through Stargate Hydra, which is known for handling a large volume of stablecoin transactions (source). TRON’s network is fast and has low fees, which fits PayPal’s goal of making money transfers cheaper.
Why it matters: This is generally positive. TRON has a large user base (about 332 million accounts), offering growth opportunities. But, there could be challenges due to regulatory scrutiny of TRON’s ecosystem.
3. Merchant Crypto Payments (September 15, 2025)
What’s happening: PayPal’s “Pay with Crypto” feature now lets U.S. merchants accept payments in over 100 cryptocurrencies, including PYUSD. These payments can be instantly converted to regular money or PYUSD (source).
Why it matters: This encourages merchants to keep PYUSD on hand, which helps reduce price swings and makes the coin more stable. Success depends on how well PayPal can get businesses to use this feature and keep conversion costs low.
Conclusion
PYUSD’s roadmap is focused on making the coin flexible across multiple blockchains and useful in everyday payments. While there are technical and regulatory challenges ahead, its strategy to work across many networks puts it in a strong position to compete with other stablecoins like USDT and USDC. The big question is: Can PYUSD use PayPal’s 435 million users to become the top stablecoin for payments?
What updates are there in the PYUSD code base?
PYUSD’s technology is advancing to work smoothly across multiple blockchains and handle more transactions quickly.
- Multichain Expansion (September 20, 2025) – PYUSD now operates on 7+ blockchains using LayerZero’s OFT standard.
- Giga Upgrade (Q4 2025) – Aims to process 200,000 transactions per second with final confirmations under 400 milliseconds on Ethereum-compatible chains.
- Arbitrum Integration (July 16, 2025) – Added support for Arbitrum Layer-2 to enable faster and cheaper transactions.
Deep Dive
1. Multichain Expansion (September 20, 2025)
Overview: PYUSD has expanded to new blockchains including Stellar, Aptos, Avalanche, Sei, and Tron by using LayerZero’s cross-chain technology. This allows users to move PYUSD easily between different blockchain networks.
This update uses LayerZero’s Omnichain Fungible Token (OFT) standard to create PYUSD0, a version of PYUSD that works seamlessly with the original. Transactions use Stargate Hydra to route liquidity efficiently, cutting cross-chain fees by about 40% compared to older methods.
What this means: This is a positive development for PYUSD because it makes the digital dollar accessible to PayPal’s 434 million+ users on fast blockchains like Solana and Tron. This could boost PYUSD’s use in sending money internationally and in decentralized finance (DeFi). (Source)
2. Giga Upgrade (Q4 2025)
Overview: A major update planned to improve how PYUSD works on Ethereum-compatible blockchains (EVM chains). The goal is to handle 200,000 transactions per second with confirmations in less than 400 milliseconds.
This upgrade uses optimistic rollups combined with parallel processing to reduce transaction costs by about 75% for PYUSD transfers. It also introduces modular smart contract templates to make it easier for developers to build on PYUSD.
What this means: This is a cautiously optimistic update for PYUSD. Faster and cheaper transactions could attract larger institutional users, but success depends on how smoothly current users on Ethereum and Solana can switch to the new system. (Source)
3. Arbitrum Integration (July 16, 2025)
Overview: PYUSD is now available on Arbitrum, a popular Layer-2 solution for Ethereum that offers very low fees (under $0.01) and quick transaction confirmations (1-2 seconds).
This required updating PYUSD’s ERC-20 token contract to work with Arbitrum Nitro’s fraud-proof system. Users can now easily move PYUSD between Ethereum and Arbitrum using built-in bridges.
What this means: This is a positive step for PYUSD because it connects to Arbitrum’s $9 billion DeFi ecosystem, increasing PYUSD’s usefulness in lending platforms like Aave and GMX. (Source)
Conclusion
PYUSD is focusing on making its digital dollar work smoothly across multiple blockchains while handling high transaction volumes. These updates expand its reach and improve performance, positioning PYUSD as a strong link between traditional finance and decentralized finance. The upcoming Giga Upgrade could be a game-changer in how PYUSD competes with other stablecoins like USDC and USDT in DeFi liquidity.