PayPal's PYUSD Becomes Universal Stablecoin with Cross-Chain Expansion

PayPal’s PayPal USD (PYUSD) stablecoin has expanded its availability to eight new blockchain networks through an integration with LayerZero’s interoperability protocol. The move introduces a permissionless version of the stablecoin, PYUSD0, which is fully interchangeable with the original token and supports seamless cross-chain transfers. The new blockchains include Tron, Avalanche, Aptos, Abstract, Ink, Sei, Stable, and Stellar, with existing community-issued versions on Berachain and Flow automatically converting to the PYUSD0 standard. This expansion increases PYUSD’s presence from four native networks—Ethereum, Solana, Arbitrum, and Stellar—to 13 total ecosystems, positioning it as one of the most accessible stablecoins in the crypto market title1^[1].

The integration leverages LayerZero’s Hydra Stargate system, which enables the minting, burning, and deployment of PYUSD0 across multiple blockchains without reliance on centralized infrastructure. Users can now transfer their tokens between supported chains while maintaining self-custody. LayerZero CEO Bryan Pellegrino emphasized that the update demonstrates the potential for a global financial system operating continuously across borders, with stablecoins serving as a “killer app” for mainstream adoption. The technical implementation ensures PYUSD0 remains fungible with the original stablecoin, allowing developers and users to access decentralized finance (DeFi) platforms and cross-chain applications previously incompatible with PayPal’s token title2^[2].

PYUSD’s supply has grown significantly since its August 2023 launch, reaching $1.3 billion by September 2025—more than double its $520 million value at the start of the year. This growth reflects increasing demand for dollar-pegged stablecoins in cross-chain transactions and DeFi protocols. Despite its expansion, PYUSD ranks 11th in the stablecoin market by market capitalization, trailing industry leaders like Tether (USDT) and Circle (USDC), which hold $171.2 billion and $74.3 billion, respectively. The U.S. Treasury has projected the stablecoin market could grow from $295 billion to $2 trillion by 2028, driven by regulatory clarity and technological advancements like LayerZero’s interoperability solutions title3^[3].

The Stellar integration, announced separately, highlights PYUSD’s focus on low-fee, high-speed transactions. Stellar’s five-second finality and affordability appeal to users in developing economies seeking to transact in U.S. dollars. PayPal’s partnership with Paxos, a regulated blockchain infrastructure firm, ensures compliance with financial regulations while expanding PYUSD’s utility. Analysts note that the expansion aligns with broader trends in fintech, where traditional institutions are increasingly adopting blockchain interoperability to compete in decentralized markets. By embedding PYUSD across diverse ecosystems, PayPal aims to solidify its role in both payments and DeFi, offering users greater flexibility to move value without intermediaries title4^[4].

The move underscores PayPal’s strategic vision to position PYUSD as a universal stablecoin. By reducing friction in cross-chain transactions and expanding access to DeFi, the company is addressing gaps in the current financial infrastructure. However, challenges remain, including competition from larger stablecoins and regulatory scrutiny. The recent passage of the GENIUS Act in July 2025, which established comprehensive U.S. stablecoin legislation, provides a framework for PYUSD’s growth while ensuring compliance with anti-money laundering (AML) standards. As the stablecoin market matures, PayPal’s ability to balance innovation with regulatory adherence will be critical to maintaining its market position title5^[5].