June 5, 2024
Latest Cryptocurrency News

PayPal Chooses Solana Blockchain for PYUSD Expansion

In a significant move, PayPal has selected the Solana blockchain to extend its stablecoin, PayPal USD (PYUSD), marking a departure from its reliance on the Ethereum ecosystem. The decision, announced on May 28, aims to leverage Solana’s high transaction throughput and lower costs. Thus, enhancing PYUSD’s utility as a payment method for everyday transactions.

Enhanced Transaction Speed and Lower Costs

Solana blockchain boasts processing speeds of up to 65,000 transactions per second, with transaction fees as low as $0.0025. This stands in stark contrast to Ethereum’s throughput of 15 transactions per second, accompanied by higher fees ranging from $1 to $50 during congestion.

The move to Solana promises quicker transaction processing times, with transfers completing in less than a minute compared to Ethereum’s potential wait times of several minutes.

Jose Fernandez da Ponte, PayPal’s senior vice president of blockchain, emphasized:

“Making PYUSD available on the Solana Blockchain furthers our mission of enabling a digital currency with a stable value designed for commerce and payments.”

Chain-Agnostic User Experience

PayPal and Venmo wallet users will experience a seamless transition to the Solana network, with PYUSD balances remaining unified across different networks. This chain-agnostic approach ensures ease of use and accessibility for users regardless of the underlying blockchain infrastructure.

Solana’s Rising Dominance and Challenges

Solana has emerged as a frontrunner in stablecoin transfers. It witnessed a staggering $1.5 trillion in transfer volume over the past year, surpassing Ethereum’s $885 billion.

Stablecoins Transfer Volume in USD. Source: Artemis

However, the network faces challenges, notably recurring network outages. An upcoming upgrade, Firedancer, aims to address these issues, enhancing Solana’s reliability and scalability.

The Future of Stablecoins

Stablecoins, designed to maintain a constant value by pegging to reserve assets like the U.S. dollar, play a crucial role in facilitating digital transactions.

PayPal’s foray into the stablecoin market with PYUSD, initially launched on Ethereum in August 2023, underscores the growing importance of stablecoin adoption in mainstream finance.

Despite Tether’s current dominance, PYUSD’s integration with Solana signals a strategic expansion, aiming to capture a broader market share in the evolving landscape of digital currencies.

Image from Wallpapers.com

Disclosure Statement: Miami Crypto does not take any external funding, or support to bring crypto news to the readers. We do not have any conflicts of interest while writing news stories on Miami Crypto.

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