PayPal has made history by completing its first-ever business transaction using PYUSD, the company’s own stablecoin. On September 23, PayPal paid an invoice to Ernst & Young LLP using PYUSD through SAP’s digital currency hub. This platform allows payments to be made instantly, 24/7, without the delays that usually happen with traditional cross-border payments. The company did not share how much the payment was for, but this event is a major milestone for PayPal and its role in cryptocurrency for business.
PYUSD was launched last year and is pegged to the US dollar, meaning its value stays stable compared to more volatile cryptocurrencies. At the time of this transaction, PYUSD had a market cap of $700 million and is becoming more popular among businesses for faster, more reliable payments. The use of stablecoins like PYUSD is growing because it offers businesses a better way to make payments across borders without the need for third-party banks or payment processors, which can slow things down.
PayPal has been expanding its role in cryptocurrency, and this latest move proves that it is serious about leading the way in stablecoin adoption. The company believes that using PYUSD for business-to-business (B2B) transactions is a smart choice for financial leaders. In fact, Jose Fernandez da Ponte, PayPal’s senior vice president of blockchain, cryptocurrency, and digital currency, highlighted how stablecoins are especially helpful in business payments. By using PYUSD, companies can avoid the long wait times and risks that come with traditional cross-border payments.
The reason for this is that stablecoin payments can be settled almost instantly on the blockchain, which is a huge improvement over the usual methods that involve multiple intermediaries like banks and payment processors. These intermediaries often slow down the payment process and can increase the chances of something going wrong. With PYUSD, businesses get faster settlements, which means they can pay their international partners quickly and safely.
Countries that have very volatile currencies are also seeing the benefits of stablecoins for managing their business transactions. By using stablecoins like PYUSD, they can avoid the problems that come with unstable exchange rates. PayPal’s move to use PYUSD for its own transactions shows that the company is confident that stablecoins can solve many of the issues businesses face with cross-border payments.
Earlier this year, a payments platform called BVNK also made headlines when it allowed businesses to send US dollars through SWIFT and then convert them into stablecoins to pay partners around the world. This process cuts out the usual middlemen and speeds up transactions, similar to what PayPal is doing with PYUSD. It’s becoming clear that stablecoins are gaining momentum in the business world as a way to make global payments faster and easier.
In addition to using PYUSD for its own transactions, PayPal also announced that it will allow merchants to buy, hold, and sell cryptocurrency directly from their business accounts. This is a big deal because it opens the door for even more businesses to adopt digital currencies. By offering this service, PayPal is positioning itself as a major player in the world of cryptocurrency for business.
The company’s financial results reflect its success in this area. In the third quarter (Q3), PayPal reported $9.08 billion in revenue, which is a 12% increase compared to the same period last year. This growth is mainly driven by more people using PayPal for their payments and an increase in the volume of transactions. The company’s net income for Q3 was $1.64 billion, which translates to a net income margin of 18%. This shows that PayPal is not just growing, but it’s doing so profitably.
PayPal’s earnings per share (EPS) also grew in Q3, reaching $1.25 compared to $1.10 in the same period last year. This is a clear sign that the company’s business model is working, and it’s managing to keep costs under control even as it invests heavily in new technologies like cryptocurrency. PayPal’s operating expenses for the quarter were $6.56 billion, including $1.2 billion spent on research and development and $2.9 billion on general and administrative costs. Despite these high expenses, the company’s gross profit for the quarter was $2.52 billion, giving it a gross profit margin of 27.8%.
One of the key reasons for PayPal’s success is the increase in active accounts. The company now has 500 million active accounts, up from 480 million earlier this year. This growth in user engagement is helping to drive up the total payment volume (TPV) processed by PayPal. In Q3, the company processed $355 billion in payments, which is 10% higher than the same time last year. This increase in TPV shows that more people are using PayPal for their everyday transactions, and it also suggests that businesses are trusting PayPal to handle their payments on a larger scale.
This is especially important as PayPal continues to push for more adoption of PYUSD and other cryptocurrencies. With more businesses turning to digital currencies for their payments, PayPal is in a prime position to capitalize on this trend. The company is showing that stablecoins like PYUSD are not just a passing fad but a practical solution for businesses that want to streamline their payment processes and avoid the risks associated with traditional banking systems.
By making its first business transaction using PYUSD, PayPal has taken a significant step toward proving that stablecoins are ready for mainstream use in the business world. This move will likely encourage other companies to consider using stablecoins for their own transactions, especially as the benefits of faster, more secure payments become clearer.
Overall, PayPal’s decision to use PYUSD for B2B transactions shows that the company is committed to staying at the forefront of the cryptocurrency revolution. With its strong financial performance and increasing adoption of digital currencies, PayPal is well-positioned to lead the way in this space. As more businesses recognize the advantages of stablecoins like PYUSD, it’s likely that we’ll see even more companies following PayPal’s example and embracing digital currencies for their cross-border payments.
PayPal’s first stablecoin transaction using PYUSD marks a pivotal moment in the business world. With its focus on faster, safer, and more reliable payments, PayPal is helping to pave the way for broader adoption of stablecoins in business. As more companies look for better ways to handle their payments, PYUSD and other stablecoins are set to play a big role in transforming how businesses manage their financial transactions.
