PayPal's PYUSD Cleared by SEC, Earnings Rise 1%

PayPal has received confirmation from the U.S. Securities and Exchange Commission (SEC) that its investigation into the company’s U.S. dollar-backed stablecoin, PYUSD, has been concluded without any enforcement action. This news was disclosed in a regulatory filing on April 29, where PayPal stated that the SEC had notified them of the case's closure. The investigation had commenced in November 2023 following a subpoena from the SEC’s Division of Enforcement, which requested documents related to PYUSD.

This development marks a significant milestone for PayPal’s cryptocurrency ambitions, as it clears a regulatory hurdle that had been looming over PYUSD. The closure of the investigation is part of a broader trend where the SEC, under its new leadership, has been easing pressure on various crypto firms. Recent months have seen the SEC end probes into several other major players in the cryptocurrency sector, including Crypto.com, Robinhood Crypto, Coinbase, and Gemini. This shift in regulatory approach suggests a more accommodating stance towards the cryptocurrency industry.

PayPal’s first-quarter 2025 earnings report further highlighted the company’s financial strength, with earnings of $1.33 per share and revenue rising 1% year-over-year to $7.8 billion. The company also reported significant share repurchase activities during the quarter, indicating a robust financial performance. PYUSD, launched in August 2023, is designed to be fully backed by U.S. dollar deposits, short-term Treasuries, and cash equivalents, ensuring a 1:1 redeemability for U.S. dollars. Despite these assurances, PYUSD has captured only a small share of the stablecoin market, which is dominated by larger players such as Tether and Circle. As of late April, PYUSD’s market capitalization stood at approximately $880 million, less than 1% of Tether’s market capitalization. However, recent months have seen a pickup in PYUSD’s growth, with its circulating supply rising 75% since the start of 2025.

To boost adoption, PayPal recently introduced a new loyalty program that offers U.S. users an annual yield of 3.7% for holding PYUSD on its platform. The company also announced a partnership with Coinbase aimed at expanding the stablecoin’s use cases. Alex Chriss, PayPal President and CEO, expressed excitement about driving new and innovative use cases for PYUSD in collaboration with Coinbase and the broader cryptocurrency community. With the SEC inquiry now closed, PayPal is poised to expand PYUSD’s presence in the digital asset market. The company plans to leverage new partnerships and product offerings to compete in the crowded stablecoin sector. This regulatory clarity is expected to ease concerns for crypto markets and pave the way for further growth and innovation in the stablecoin ecosystem.