PayPal has completed its first-ever business payment using its proprietary stablecoin, PayPal USD (PYUSD).
The transaction marks another move for mainstream big business toward cryptocurrency, as initially reported by Bloomberg.
PayPal made the undisclosed payment on September 23, settling an invoice from Ernst & Young LLP via SAP’s digital currency hub which provides the platform for instant transfers.
PYUSD is a crypto token pegged to the US dollar, also known as a stablecoin because it is designed to maintain its set value at $1. It operates on the public blockchains Ethereum and Solana, alongside thousands of similar crypto assets.
Following its launch in 2023, Paypal USD now has a market capitalization of almost $700 million.
Last week, the company announced it would allow business customers in the U.S. to buy, hold, and sell crypto directly from their PayPal account.
A press release from the online payment portal detailed the update for business customers, four years on from the same crypto facilities were enabled for personal accounts.
PayPal drawn toward established names for stablecoin payment
The use of crypto for customer-facing transactions is well established, but this landmark payment for PayPal reflects the scope for B2B growth, as intimated by Jose Fernandez da Ponte, the company’s senior vice president of blockchain, cryptocurrency, and digital currency.
“The enterprise environment is very well-suited for it. It’s a very rational conversation to have with the CFO,” he said.
In business, transactions are often complex and risky, especially international payments which can incur fees and reliance on third-party processors. The benefit of PYUSD over traditional currency is that crypto can be bought, sold, and transferred 24/7.
That is likely to be an attractive proposition for certain business operations but there is also vigilance of the prevalent risk around crypto. PayPal entered into the transaction with cognizance of this, moving toward household names as part of their latest play.
“PayPal, SAP, EY – those are names that are very, very well-established,” added Fernandez da Ponte.
Image credit: Via Ideogram
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