PayPal Bridges PYUSD to Global Markets via Stable Partnership

PayPal Holdings Inc. (NASDAQ: PYPL) has announced a strategic investment in Stable, a Layer 1 blockchain project developed under Tether, to enhance the distribution, utility, and liquidity of its U.S. dollar-backed stablecoin, PayPal USD (PYUSD). This move marks PayPal’s latest effort to integrate stablecoins into its digital payment ecosystem while expanding PYUSD’s reach across global blockchain networks. The investment, led by PayPal Ventures, the venture arm of the fintech giant, follows Stable’s recent $28 million seed funding round, which included participation from Bitfinex and Hack VC.

Stable, a blockchain network designed for seamless financial transactions, utilizes Tether’s USDT as its native gas token to facilitate low-cost, high-speed transactions. Under the partnership, PYUSD will be integrated into the Stablechain, enabling users to leverage the stablecoin for commerce and cross-border payments. The integration will leverage LayerZero’s interoperability protocol to bridge PYUSD across blockchains programmatically, ensuring near-instant finality and cost efficiency. This collaboration aligns with PayPal’s broader strategy to position PYUSD as a core instrument in the crypto economy, with plans to explore cross-chain compatibility and onramp/offramp capabilities for the token in the future.

The investment underscores PayPal’s commitment to expanding PYUSD’s utility beyond its native blockchains (Ethereum, Solana, Arbitrum, and Stellar). By integrating PYUSD into Stable’s network, PayPal aims to tap into a blockchain ecosystem that prioritizes stablecoin-driven transactions, particularly in markets where dollar-backed tokens are critical for remittances, e-commerce, and peer-to-peer payments. Sam Kazemian, Stable’s newly appointed Chief Technology Officer, emphasized the synergy between PayPal’s payment infrastructure and Stable’s focus on “real-world adoption of stablecoins,” stating the partnership could drive “the next true advancement in cross-border transactions”.

PayPal’s PYUSD, issued by Paxos Trust Company and backed by U.S. dollar deposits and Treasuries, has grown to a market capitalization of $1.3 billion as of September 2025. The token’s expansion to Stable’s network follows its recent availability on nine additional blockchains, including Tron, Avalanche, and Aptos, facilitated by LayerZero’s Stargate Hydra system. This move positions PYUSD to compete more effectively with established stablecoins like Tether’s USDT ($171 billion market cap) and Circle’s USDC ($74 billion), which dominate the $239 billion stablecoin market.

The partnership also highlights PayPal’s strategic alignment with Tether, the issuer of USDT. While Tether has faced regulatory scrutiny in the U.S., its dominance in global stablecoin settlements—accounting for 18% of BRICS trade—positions it as a key player in the digital asset ecosystem. By integrating PYUSD into Tether’s infrastructure, PayPal may enhance its access to liquidity pools and transaction networks, particularly in emerging markets where stablecoins serve as a hedge against inflation and currency volatility.

PayPal’s investment in Stable reflects a broader industry trend of traditional financial institutions leveraging blockchain interoperability to expand their digital offerings. As stablecoins surpass $210 billion in market capitalization—exceeding PayPal’s own valuation—the regulatory landscape is evolving to address risks such as redemption mandates and reserve transparency. PayPal’s collaboration with LayerZero and Tether aims to address these challenges by ensuring compliance and scalability, while its focus on cross-chain functionality aligns with growing demand for seamless, borderless payments.