How Ethereum stands to gain from PayPal USD’s launch
- Paypal launched its stablecoin as an ERC-20 token on the Ethereum network.
- Sentiment around Ethereum improved, but price movement remained the same.
Recently, online payment leader PayPal forayed into the digital currency sphere via its own stablecoin named PayPal USD [PYUSD]. The stablecoin will maintain a 1:1 peg to the US dollar and derive its backing from dollar deposits, short-term US treasuries, and cash equivalents.
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It is worth noting that the stablecoin is an ERC-20 token on the Ethereum [ETH] network. Inasmuch, a growing number of individuals are developing the belief that Ethereum is:
“Slowly but surely becoming a global settlement layer for all types of value.”
This transformation is being driven by the platform’s inherent capabilities and expanding use cases.
PayPal just announced that they are launching a USD stablecoin, called PYUSD, as an ERC20 token on the Ethereum network
Ethereum is slowly but surely becoming a global settlement layer for all types of value
— sassal.eth ?? (@sassal0x) August 7, 2023
Ethereum has a new “Pal”
The Ethereum network also surpassed the performance of prominent payment entities as of 8 August. According to analyst Tom Wan, Ethereum has successfully settled transactions worth a staggering $33.4 trillion or more since its inception.
Interestingly, stablecoins contributed over 50% of this volume.
Comparatively, in 2022, Visa handled a payment volume of $11.6 trillion, while Ethereum settled a total volume of $12 trillion. Although Ethereum’s on-chain volume might be slightly inflated due to wallet swaps and speculation on centralized exchanges (CEXes), its role as an impartial settlement layer was evident.
Ethereum has already settled over $33.4T+ On-Chain since genesis. Stablecoin accounts for more than 50% of the volume
— Tom Wan (@tomwanhh) August 8, 2023
Moreover, according to Wan, the potential of Layer-2 (L2) solutions was promising, as they offer swifter execution and reduced fees, likely leading to increased volume on Ethereum in the future.
Retail investors show interest
Not only institutional players, but retail investors also demonstrated a strong interest in ETH. Glassnode’s data revealed that the number of addresses holding more than 0.01 coins surged to an all-time high of 24,664,304 at press time.
This heightened engagement highlighted Ethereum’s appeal across various investor segments.
Realistic or not, here’s ETH’s market cap in BTC’s terms
Despite the interest showcased in Ethereum, the price of the cryptocurrency did not see much positive movement. At press time, ETH was trading at $1.833.69.
However, even though the price of ETH was declining, gas usage remained consistent throughout the last seven days, implying that users had actively used the protocol over the last week.