- PYUSD adoption expands beyond apps, entering DeFi protocols on both Ethereum and Solana with broader utility.
- Ondo, Zero Hash, and Morpho support unlocking more real-world use cases and passive yield opportunities.
The supply of PayPal’s PYUSD stablecoin is approaching the psychological $1 billion mark, according to Token Terminal. While it was initially launched as a stable digital payment alternative, it has now expanded further into the DeFi space.
The surge has not only occurred on the Ethereum network, but also on Solana, which has seen distribution growth of over 170% in the past month. Many initially thought PYUSD would only “hang out” in PayPal and Venmo wallets, but it turns out that it is now starting to be used in a wider—and riskier—ecosystem.
In mid-May, a report from CNF revealed a new feature from Ondo Finance that allows instant conversion between OUSG (a tokenized Treasury asset) and PYUSD. The process? No fees and no time lag. This feature is a kind of express toll gate for users who want to access Treasury-based assets at any time using PYUSD.
So, for example, in the middle of the night you want to “park funds” into interest-bearing assets, just click. No need to wait for business hours like traditional banks.
ICYMI: @PayPal's PYUSD is closing in on $1 billion supply, with growth on both @ethereum & @solana. pic.twitter.com/goAb6r4QZT
— Token Terminal 📊 (@tokenterminal) June 8, 2025
Solana Becomes PYUSD’s Second Home, DeFi Opens Its Doors Wide
Interestingly, although Ethereum has been PYUSD’s main home since the beginning, Solana is now starting to compete in terms of distribution volume. Not only because of faster and cheaper transactions, but also because of integration with several DeFi protocols such as Kamino and Drift.
These two protocols make PYUSD more than just a stablecoin: it can be rotated, used as collateral, or stored while waiting for daily interest.
Still on the subject of the ecosystem, early March, Zero Hash—a crypto infrastructure provider platform—entered the arena.
They officially added PYUSD to their system. This means that their users can now use PYUSD for various things: from cross-border payments, sending money abroad, to buying other crypto assets via on-ramp services. Overseas, features like this are starting to become popular among remittance companies and payment startups.
Furthermore, last May PYUSD could also be used as collateral at Morpho Blue. The protocol, curated by Steakhouse Financial, allows users to lock real-world assets like bIB01 and wstETH and earn double the yield from both crypto and traditional.
The system, which they call “Dual‑Engine Yield,” makes PYUSD even more flexible, especially for investors who want to combine old-world and new-world profits.
No Longer Just a Token, It’s Becoming a Full-On Ecosystem
Another factor that boosted PYUSD’s growth was the end of the SEC’s investigation into the stablecoin. Without charges or sanctions, investor and user confidence was clearly boosted. Not only that, PayPal also started offering a 3.7% annual yield for US users who hold PYUSD in their wallets. This yield is paid out in PYUSD every month, a kind of Web3 version of “interest savings.”
From a strategic standpoint, PayPal’s move doesn’t seem to be just for show. They’re not just creating a stablecoin and putting it in an app, but also letting it live on networks with high liquidity and an active community.
PYUSD has even crossed over from the e-wallet world to the world of traders, yield farmers, and hardcore DeFi users. And as it stands, the results are quite exciting: supply continues to rise, more protocols are accepting it, and integration is expanding.
