The recent launch of PayPal’s stablecoin, PYUSD, has stirred the cauldron of crypto enthusiasts worldwide. While the financial giant’s foray into cryptocurrencies had been anticipated as a significant step towards wider crypto adoption, seeming reality has started to veer of-course from such expectations.
PYUSD’s rollout was hailed as a landmark moment. It was perceived to push the barriers for broader crypto acceptance, making cryptocurrencies commonplace. However, the on-chain data paints a disparate picture, suggesting that this potentially revolutionary intervention is off to a rather sluggish start.
According to findings from blockchain analytics firm Nansen, about 90% of PYUSD currently lies in the reserves of Paxos Trust, the stablecoin issuer. Merely 7% finds residence in crypto exchange wallets such as Kraken, Gate.io, and Crypto.com. The presence of PYUSD among well-versed or professional investors, often referred to as the “smart money,” appears scarce, at best.
The inception of PayPal’s stablecoin in August had spiked expectations of a seismic shift in the crypto ecosystem. Interestingly, despite PayPal hosting an enormous customer base of 350 million globally, its stablecoin has found few takers so far. This surprising trend could be hinting at the crypto community’s preference for other alternatives over PYUSD.
PayPal’s stablecoin is tethered to the U.S. dollar and is dispatched by Paxos Trust Co. Despite its purportedly tepid reception, the coin has ushered in competition amongst well-established crypto entities. For instance, USD Coin, backed by Circle, announced expansion to six additional blockchains this week, taking its total count to 15 network availabilities.
In comparison to PYUSD, the market capitalization figures for USD Coin and Tether are demonstrably large. CoinMarketCap data illustrates that USD Coin sits at a market cap of approximately $25 billion while Tether occupies a towering $82 billion.
While PYUSD’s slow commencement may raise eyebrows, it’s crucial to acknowledge that the stablecoin has only been in play for less than three weeks, and without a launch announcement. As crypto markets continue to evolve, and PayPal’s massive user base starts to explore, the tides for PYUSD could yet turn, illustrating that it may be too soon to cast aspersions on its future potential.
Source: Cointelegraph
