PayPal USD Circulation Drops by 39% to $188.5 Million in March: Paxos
The stablecoin PayPal USD (PYUSD), issued jointly by payment giant PayPal and cryptocurrency company Paxos, experienced a notable decrease in circulation in March.
According to Paxos’ most recent transparency report on PayPal USD, the circulation of PYUSD in March totaled $188.5 million, marking a 39% decrease compared to the previous month.
Recent data from CoinGecko reveals that the PYUSD has experienced a drop in market capitalization since late February, following its peak at an all-time high of $312 million on February 26. The circulation of PayPal USD (PYUSD) peaked at $304 million in February and $301 million in January, indicating a significant shift in March.
Despite witnessing significant growth at the start of 2024, with its market value doubling within about a month by mid-January, PYUSD’s market cap has been on a downward trend.
As of the latest update, PYUSD’s market cap stands at $194 million, reflecting a 3% increase over the past seven days. Interestingly, this decline in market cap occurred amidst a broader rally in cryptocurrency markets, notably with Bitcoin (BTC) breaking all-time highs above $73,000 on March 13.
Notably, as of March 29, the PayPal USD treasury held $14.9 million in United States Treasury bonds, with a notional value of approximately $14.8 million.
Furthermore, the report also detailed the use of Reverse Repurchase Agreements, a contractual arrangement involving the sale and repurchase of securities. Paxos engages in overnight maturity Reverse Repurchase Agreements with reputable financial institutions, overcollateralized with U.S. Treasuries. In the event of a counterparty default, Paxos can liquidate the U.S. Treasury collateral to cover any losses, mitigating the risk significantly.
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