XLM's 100% Surge and PayPal's Stablecoin Move: A New Era for Stellar?

In the ever-evolving landscape of blockchain and digital finance, few developments have captured investor attention as swiftly as Stellar's (XLM) recent 100% price surge and PayPal's strategic integration of its stablecoin, PayPal USD (PYUSD), onto the Stellar network. This partnership, announced in June 2025 and pending regulatory approval from the New York State Department of Financial Services (NYDFS), marks a pivotal moment for Stellar, positioning it as a key player in the next phase of digital asset adoption. Meanwhile, XRP, its cross-border payments rival, continues to navigate a complex regulatory environment while experiencing its own bullish momentum. This article examines how PayPal's move signals a strategic inflection point for XLM and contrasts it with XRP's challenges and opportunities.

PayPal's PYUSD on Stellar: A Catalyst for XLM's Growth

PayPal's decision to expand PYUSD to the Stellar blockchain underscores the platform's unique value proposition: fast, low-cost transactions and scalable infrastructure. By leveraging Stellar's network, PayPal aims to enhance PYUSD's utility for real-world applications such as cross-border remittances, small business financing, and everyday payments. This integration is expected to drive XLM's adoption by connecting PYUSD to Stellar's global ecosystem of on- and off-ramps, local payment systems, and digital wallets, potentially reaching 170+ countries.

The market has already responded positively. In July 2025, XLM surged over 72% in three weeks, driven by PayPal's announcement and institutional validation. The Stellar network's total value locked (TVL) hit $140.7 million, while daily transactions soared to 2.1 million, and weekly active addresses rose to 266,800—a 37% monthly increase. These metrics reflect growing confidence in Stellar's ability to scale as a backbone for global financial services.

Institutional Adoption and Real-World Utility

Stellar's appeal lies not only in its technical capabilities but also in its growing institutional partnerships. Franklin Templeton's tokenization of $445 million in U.S. Treasuries on Stellar in 2025 further solidified the network's role in real-world asset (RWA) tokenization. Meanwhile, PayPal's integration is expected to expand PYUSD's utility beyond Ethereum and Solana, bringing new liquidity and use cases to XLM.

The Stellar Development Foundation's recent hires—José Fernández da Ponte (former PayPal blockchain head) and Jason Karsh (ex-Block)—signal a strategic push to accelerate institutional adoption. These moves, combined with Protocol 23 upgrades (targeting 5,000 TPS and 2.5-second settlement times), position Stellar as a formidable infrastructure layer for stablecoins and financial services.

Contrasting XRP's Regulatory Challenges and Bullish Momentum

While XLM enjoys regulatory clarity and institutional momentum, XRP remains mired in legal battles with the SEC. The 2023 court ruling, which partially cleared XRP of being a security in secondary market transactions, has created a more favorable environment, but the SEC's ongoing appeals and enforcement actions continue to weigh on investor sentiment. However, XRP's price has surged 13.07% in July 2025 alone, reaching $3.37, driven by the launch of the ProShares Ultra XRP ETF (UXRP) and broader crypto market optimism.

The Trump administration's pro-crypto agenda, including plans for a national Bitcoin stockpile and a potential shift in SEC leadership, has also fueled speculation that XRP's regulatory hurdles may ease. Ripple's application for a national banking charter further signals its intent to operate within a traditional financial framework, potentially attracting institutional investors.

Market Dynamics: XLM's Open Interest vs. XRP's Institutional Push

Open interest (OI) for XLM has surged to $346 million in July 2025, reflecting heightened speculative and institutional activity. This contrasts with XRP's focus on ETF-driven liquidity, where the ProShares Ultra XRP ETF has attracted over $12 billion in trading volume. While XLM's growth is driven by network utility and stablecoin adoption, XRP's trajectory depends on regulatory resolution and institutional product launches.

Strategic Inflection Point for XLM

PayPal's integration of PYUSD on Stellar represents more than a technical upgrade—it's a strategic inflection point. By aligning with a global payments giant, Stellar is transforming from a niche blockchain into a foundational infrastructure for digital finance. The partnership could drive XLM's price higher if PYUSD's adoption accelerates, particularly in emerging markets where Stellar's low fees and speed offer a compelling alternative to traditional systems.

For XRP, the path forward remains uncertain. While its bullish momentum suggests optimism about regulatory clarity, investors must weigh the risks of ongoing legal battles. XRP's potential to surpass $4.50–$6.00 by year-end hinges on the outcome of the SEC case and broader market sentiment.

Investment Outlook

For investors, the Stellar-XRP contrast offers distinct opportunities:
- XLM is ideal for those seeking exposure to a blockchain with growing institutional adoption, stablecoin utility, and regulatory alignment. Key price levels to monitor include $0.4750–$0.48 (resistance) and $0.44 (support).
- XRP appeals to those willing to bet on regulatory resolution and ETF-driven demand. However, its volatility and legal uncertainties require a higher risk tolerance.

Conclusion

Stellar's integration with PayPal marks a defining moment for XLM, validating its role as a scalable infrastructure for digital finance. As PYUSD gains traction, XLM's price and network activity are likely to continue rising, driven by real-world utility and institutional adoption. Meanwhile, XRP's future remains tied to regulatory outcomes, but its recent momentum suggests it could still carve a niche in the crypto market. For investors, both tokens represent compelling, albeit distinct, opportunities in the evolving digital finance landscape.