Stablecoin PayPal USD (PYUSD) is now available on the Solana blockchain network. Users will be able to make confidential transactions and transfer tokens between the Ethereum and Solana networks without any extra fees.
PayPal, a major payment provider, expanded the use of its stablecoin PYUSD by adding support for the Solana blockchain. The initiative aims to improve the stablecoin’s usability for day-to-day payments and lower transaction costs.
According to Sheraz Shere, GM of Payments at the Solana Foundation, using the Solana network will allow PayPal to increase the popularity of PYUSD as a payment option for small and everyday purchases, as Solana’s performance far exceeds that of the Ethereum network, where the stablecoin was originally launched.
The Solana network can potentially process up to 65,000 transactions per second. At that, the average cost of a transaction is only $0.0025. In contrast, the Ethereum blockchain processes only about 15 transactions per second, with fees ranging from $1 to $50 during congestion.
Users can exchange PYUSD on Ethereum for PYUSD on Solana without any additional fees. This can be done through flagship crypto wallets PayPal, Venmo, and Paxos, as well as crypto exchanges Crypto.com and Phantom.
The white paper states that the functionality of PYUSD on Solana allows for:
- providing users with confidentiality of transaction amounts while maintaining visibility of other transaction details for regulatory purposes;
- using additional programmability features for developers to invoke certain programs with each token transfer, giving more control over assets for wallets;
- including notes in transactions to both senders and receivers to simplify record keeping.
The new confidential transfer feature sparked significant discussion within the crypto community, receiving both positive and skeptical feedback. Mert Mumtaz, CEO of Helius Labs, praised confidential transfers and the native programmability of tokens on Solana as a genuine breakthrough. Meanwhile, Bitcoiner Udi Wertheimer wryly remarked that the Bitcoin community has been discussing similar privacy features for almost a decade, yet it was Solana users who ultimately benefited from them first, thanks to PYUSD.
The PayPal stablecoin was launched in August 2023, the issuer was Paxos Trust Co. In April 2024, U.S. residents got the opportunity to use PYUSD for cross-border transfers with no fees.
