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In March, PYUSD, the stablecoin jointly issued by PayPal and Paxos, experienced a notable decline in circulation, as per Paxos’ recent transparency report.
The circulation dipped to $188.5 million, marking a 39% decrease compared to the prior month’s figures. This decline follows peak circulation in February and January, where PYUSD reached $304 million and $301 million respectively.
As of March 29, the PYUSD treasury held $14.9 million in United States Treasury bonds, valued at approximately $14.8 million. Market-wise, PYUSD’s collateral in U.S. Treasury bond-collateralized reverse repurchase agreements stands at $177.9 million, with a notional position value of around $174 million. Total net assets tally up to $192 million, with a notional position value of $189 million.
Market capitalization trends reveal a downward trajectory since late February, following a peak of $312 million on Feb. 26, according to CoinGecko data.
Despite this, PYUSD witnessed significant growth in early 2024, doubling its market value within a month by mid-January. Presently, its market capitalization stands at $194 million, reflecting a 3% increase over the past week.
The decrease in PYUSD circulation contrasts with a general cryptocurrency market rally, exemplified by Bitcoin (BTC) surging to all-time highs above $73,000 on March 13.
Launched in August 2023 in collaboration with Paxos Trust, PayPal positioned PYUSD as ideal for digital payments and Web3. Pegged 1:1 to the U.S. dollar, PYUSD is backed by U.S. dollar deposits, short-term Treasurys, and other cash equivalents.
Eight months post-launch, PYUSD has established itself as a significant stablecoin, ranking 13th by market capitalization, surpassing Paxos’ Pax Dollar (USDP) and Gemini Dollar (GUSD), per CoinGecko data.