PYUSD Achieves Billion-Dollar Milestone

CoinGecko data reveals that PYUSD crossed the billion-dollar threshold in just 351 days. In comparison, USDC and USDT took 616 and 1024 days, respectively, to reach the same mark. This rapid ascent highlights the growing adoption and trust in PayPal's stablecoin.

Expansion Beyond Ethereum

Most of the PYUSD market cap is circulating on Solana, less than three months after PayPal decided to expand the issuance of its stablecoin outside of Ethereum on May 29.

On-chain data shows that over $647 million in PYUSD is deployed on Solana. Approximately $430 million is locked as collateral for lending on the money market platform Kamino.

High Yields Drive Adoption

The significant amount of PYUSD allocated at Kamino can be explained by the platform's high annual percentage yield (APY).

Currently, the base APY stands at 13.63%, with bonuses pushing it up to 14.6%. This attractive yield has undoubtedly driven many investors to lock their PYUSD on Kamino.

"The high annual percentage yield (APY) on Kamino, currently at a base of 13.63% and 14.6% with bonuses, has driven significant adoption."

Other Major PYUSD Applications

The second-largest application for PYUSD is the liquidity pool USDC/PYUSD on the decentralized exchange Orca, which has $50.4 million locked.

On Ethereum, most of the PYUSD is locked in the FRAX/PYUSD liquidity pool created at the decentralized exchange Curve Finance, with $19.5 million allocated.

Competitive Landscape

Despite the rapid growth, PYUSD still faces heavy competition on Solana and the broader stablecoin market. On-chain data shows that USDT holds a $76 million lead over PYUSD on Solana.

Yet, this could soon be overturned, as PayPal's stablecoin grew 171% over the past 30 days, while USDT shrank 1.35%. Nevertheless, USDC is nearly four times larger than PYUSD in Solana's ecosystem, amounting to $2.5 billion.

Broader Market Context

PYUSD is behind five other tokens in market cap on the broader stablecoin ecosystem. USDT dominates the $162 billion sector, with a nearly $118 billion market cap.

USDC is the second-largest stablecoin, inching closer to $35 billion. DAI is third, with over $5.1 billion in market size, while First Digital USD boasts a $3.1 billion market cap. Ethena USDe wraps up the group with $2.9 billion in size.

The rapid rise of PYUSD underscores a significant shift in the stablecoin market, highlighting the increasing competition and evolving dynamics within the ecosystem.