Paxos Reports 38% Decline in PayPal Stablecoin Circulation for March

The circulation of PayPal USD (PYUSD), a stablecoin jointly issued by PayPal and Paxos, experienced a notable decrease in March, according to Paxos’ recent transparency report.

In March, PYUSD circulation totaled $188.5 million, marking a significant 39% drop compared to February’s figures. Previous months had seen higher circulation, with PYUSD reaching $304 million in February and $301 million in January.

As of March 29, the PYUSD treasury held $14.9 million in United States Treasury bonds, with a notional value of approximately $14.8 million. The market value of PYUSD collateral in U.S. Treasury bond-collateralized reverse repurchase agreements stood at $177.9 million, with a notional position value of around $174 million. Total net assets were reported at $192 million, with a notional position value of $189 million.

Market capitalization data from CoinGecko indicates a decline in PYUSD’s value since late February, when it reached an all-time high of $312 million. Despite this decline, the market capitalization of PYUSD reached $194 million at the time of writing, showing a modest 3% increase over the past seven days.

This decrease in PYUSD circulation occurred despite a bullish period in cryptocurrency markets, with Bitcoin surpassing all-time highs above $73,000 on March 13.

While Cointelegraph reached out to Paxos for comment on the decline in PYUSD circulation, no response has been received yet.

PYUSD, introduced in collaboration with Paxos Trust in August 2023, was positioned by PayPal for digital payments and Web3 applications. Pegged to the U.S. dollar at a 1:1 ratio, PYUSD is backed by U.S. dollar deposits, short-term Treasurys, and other cash equivalents.

Despite its decline in circulation, PYUSD has established itself as a significant stablecoin, ranking as the 13th largest stablecoin by market capitalization, surpassing Paxos’ Pax Dollar (USDP) and Gemini Dollar (GUSD) according to CoinGecko. However, its market value remains a fraction of Tether’s (USDT), which boasts a market value of $106.6 billion. The total market capitalization of all stablecoins stood at $155 billion at the time of publishing.