"‘PayPal Issuance’ Buzz Fades, Trading Volume Also Declines
“Overall Crypto Market Conditions Poor, Positive News Lacks Sustainability”"
The trading volume of PayPal's stablecoin 'PayPalUSD (PYUSD)', launched by the world's largest online payment service PayPal, has been steadily declining since its release. PYUSD initially received high expectations from the market. It was the first time a global payment service provider issued a stablecoin, and with PayPal having over 400 million active accounts, there were forecasts that it would also exert influence in the coin market, but these expectations were not met.
According to CoinMarketCap, a global cryptocurrency market data site, PYUSD's trading volume for the previous day was $1.76 million (approximately 2.35048 billion KRW). This represents a 29.88% decrease compared to the daily trading volume of $2.51 million (approximately 3.33679 billion KRW) at the beginning of this month.
Earlier, on the 7th of last month, PayPal announced the launch of PYUSD, a stablecoin designed to be pegged to the US dollar at a 1:1 ratio. This raised expectations that the institutional adoption of cryptocurrencies would accelerate and that payment services using coins would increase, potentially revitalizing the market.
The global cryptocurrency research platform Zengle stated, "If stablecoins like PYUSD are used not only in DeFi (decentralized finance) but also for payments, it is expected to accelerate the mainstream adoption of blockchain." They added, "However, since PYUSD is centralized, there is potential resistance from existing cryptocurrency market players, but nonetheless, it has great potential to grow rapidly based on PayPal's infrastructure due to its regulatory-friendly operation." They further noted, "The market share of fiat-backed stablecoins is expected to steadily increase."
Despite these expectations, PYUSD's performance so far has been modest. On the 29th of last month, the daily trading volume increased to $4.44 million but has since shown a downward trend.
In the stablecoin market capitalization rankings compiled by CoinMarketCap, PYUSD ranked 19th with a market cap of $44.43 million (approximately 59.3 billion KRW). Compared to Tether (USDT), which holds the top spot with a market cap of $82.86293 billion (approximately 110.5889 trillion KRW), there is a difference of 1,865 times.
Industry insiders analyze that the current sluggish cryptocurrency prices and unfavorable market conditions have resulted in PYUSD's issuance not attracting much attention. An industry official explained, "Since the overall cryptocurrency market is not doing well, it is difficult to attract attention even when positive news emerges. Worldcoin, which was developed by Sam Altman, CEO of OpenAI who created ChatGPT, was also expected to cause significant market changes, but the reality did not meet those expectations."
Additionally, PYUSD is issued on the Ethereum blockchain, and some argue that as the network becomes more active, rising transaction fees may be another reason why the trading volume has not increased significantly.
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