PayPal’s PYUSD stablecoin supply has grown by 90% after it expanded to the Solana blockchain in May, with its market capitalization surpassing the $500 million mark as of July 8.
According to DeFillama data, PYUSD’s total supply on Solana and Ethereum has reached approximately $520 million on July 8.
Solana is driving PYUSD growth
A breakdown of its supply across the two chains shows that $399 million, representing 77% of the total supply, is on Ethereum, while $118.65 million, equivalent to 23% of its supply, is on Solana.
However, further analysis of the data shows that its adoption on the Solana network is rising, with the supply on the network rising roughly 58% during the past week. In contrast, PYUSD supply on Ethereum dropped 6% during the same period.
Unsurprisingly, the increased supply and improved adoption also boosted its trading volume. Data from Visa and blockchain analytics platform Allium Labs shows PYUSD’s weekly transaction volume exceeded $500 million at the end of last month, up from previous averages of around $150 million.
This rapid growth prompted Solana developer Paul Fidika to describe PYUSD as a “sleeper hit on Solana” because it bolsters the blockchain network “as a legit financial alternative.” He added:
“[PYUSD] makes Coinbase and Circle irrelevant; their only utility is a fee-charge bridge between bank-accounts <-> crypto addresses.”
Solana-based DeFi protocols embrace PYUSD
Market observers noted that PYUSD’s integration with leading Solana-based DeFi protocols is helping it build an ecosystem on the blockchain network.
Solana has one of the largest thriving DeFi ecosystems, with the total value of assets locked on it ranking among the top five in the industry, according to DeFillama data.
The stablecoin is available on major Solana-based DEXs Jupiter and Orca, which are reportedly introducing new products designed to encourage its use. Furthermore, the stablecoin has also been integrated into Solana’s largest lending and liquidity protocol, Kamino Finance.
Tom Wan, an analyst at 21shares, pointed out that the DeFi platform offers a 23% annual percentage yield (APY) on PYUSD, which has proven attractive to investors seeking yield opportunities.
He stated:
“A lot of the success can be attributed to Kamino Finance. Over 38% of the supply has been lent on Kamino with a 23% APY. This is also a huge step for the adoption of token extension in DeFi.”