- SEC’s decision lifts uncertainty around PYUSD.
- PYUSD eyes competition with USDT and USDC
- Stablecoins are gaining traction for payments and value storage.
The SEC finalized its examination of PayPal’s PYUSD, a USD-linked stablecoin, on April 30, 2025, with no action taken, advancing PayPal’s goals in the crypto space.
PayPal disclosed in a recent document that the SEC has ended its investigation into the company’s activities. Initiated in November 2023 through a formal court order, the investigation focused on PYUSD, a stablecoin designed to replicate the value of the US dollar exactly. Over the course of more than a year, the SEC explored the design and functioning of this digital currency.
The SEC concluded its inquiry, removing a significant regulatory obstacle for PayPal. At the same time, the proposal suggests regulators may be shifting their stance on stablecoins, which have faced increasing scrutiny recently.
PYUSD Emerges as Key Player in Crypto Payments
In 2025, PYUSD has grown extensively, and its circulating supply grew by 75% since the beginning of the year. Although PayPal is trailing behind main market leaders Tether’s USDT and Circle’s USDC, its stablecoin is picking up speed.
U.S. dollar deposits, short-term U.S. Treasuries, and other comparable cash equivalents can be used to back stablecoins issued by Paxos Trust Company. This structure guarantees PYUSD is always worth 1:1 U.S. dollar and is therefore a good option for digital payments.
PYUSD’s reach has been proactive on PayPal. In April 2025, the company joined forces with Coinbase, a leading global cryptocurrency exchange, to integrate PYUSD into its platform. Through this collaboration Coinbase users can trade PYUSD without any fees, buy, sell, and trade the stablecoin, and redeem it for U.S. dollars at 1:1 ratio.
In order to boost the number of people who use PYUSD, the approach includes forming a collaboration with Coinbase. This makes the stablecoin competitive in the cryptocurrency market.
In addition, as an additional incentive for adoption, PayPal stated that it will be offering a 3.7% annual dividend for U.S. users who hold PYUSD. This yield program aims to attract users by paying yields on their stablecoin holdings, a practice not commonly seen with other stablecoins.
The SEC has made a decision that aligns with the broader trend of placing less regulatory pressure on companies dealing in cryptocurrencies. When it comes to the digital asset arena, the present government under the SEC has adopted a more tolerant approach, which has resulted in the cultivation of an environment that is more conducive to innovation.
Investor confidence in the PYUSD currency pair is expected to rise if regulations are made more clear. It is possible that the stablecoin will play a much more significant role in the ecosystem of digital payments as PayPal continues to offer more and more partnerships and incentives of this kind in an effort to encourage wider usage.
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