PayPal announced the expansion of its US dollar stablecoin, PYUSD, to the Solana blockchain on May 29, aiming to provide users with faster, more secure, and cost-effective stablecoin transactions.

Solana confirmed this in a separate statement, highlighting that PYUSD holders would benefit from high throughput, quick settlement speeds, and a new token extension feature enhancing compliance.

Jose Fernandez da Ponte, PayPal’s Senior Vice President, stated:

“Integrating PYUSD with the Solana blockchain supports our mission to create a stable digital currency for commerce and payments.”

Experts believe this move will boost PYUSD adoption among retail crypto users. Phantom, a leading Solana-focused crypto wallet provider, announced that its users can now buy and transfer PYUSD without transaction fees.

This expansion comes nearly a year after PYUSD launched on Ethereum in August 2023. Since then, the stablecoin has seen modest growth and has caught the attention of the US Securities and Exchange Commission (SEC).

According to CryptoSlate, PYUSD’s market capitalization is around $400 million.

Since the beginning of the year, Solana has become a dominant stablecoin network due to its high transaction speeds and low costs. PayPal cited these factors as key reasons for choosing Solana, noting its suitability for PYUSD as it gains traction among PayPal's over 30 million merchants.

Blockchain analytics from Artemis and Visa show Solana was the most used blockchain for stablecoin transfers last month, with a stablecoin supply exceeding $4 billion, predominantly from Circle’s USD Coin (USDC).

This growth is attributed to significant capital inflows driven by the memecoin craze and expanding DeFi activities within the Solana ecosystem.