PayPal USD Integrates LayerZero To Unlock Cross-Chain Transfers

PayPal USD users can now execute cross-chain transfers.

On Nov 12, PYUSD integrated support for the Omnichain Fungible Token (OFT) Standard from LayerZero, a cross-chain interoperability protocol. The integration facilitates PYUSD transfers between Ethereum and Solana, the two networks on which PYUSD is currently deployed.

Cross-chain transfers are secured by a Decentralized Verifier Network comprising validators chosen by Paxos — the company issuing PayPal USD. The verifiers currently include Google Cloud, LayerZero Labs, and Paxos.

LayerZero noted that the OFT integration eliminates liquidity fragmentation and allows PYUSD holders to transfer their assets between networks without relying on centralized platforms like Venmo or PayPal.

“The OFT standard unlocks a new level of interoperability for stablecoins,” said Bryan Pellegrino, CEO of LayerZero Labs. “By using LayerZero, PYUSD can move seamlessly between Ethereum and Solana — helping holders move their tokens between chains to use how they want and when they need to.”

PYUSD went live in August 2023 and has since emerged as the 11th-largest stablecoin by market cap, according to CoinGecko.

PYUSD enjoyed a surge of growth after launching on Solana in May, with its capitalization jumping 161% to an all-time high of $1.04 billion in late August from $398 million. The move made PYUSD the fifth-fastest stablecoin to cross the ten-figure market cap threshold.

However, with the growth appearing to rely on unsustainable incentives subsidized by Solana-based DeFi protocols, PYUSD’s capitalization has steadily declined since.

Most of the pullback took place on Solana, which accounted for 64% or roughly $660 million of the total, according to DeFi Llama. Meanwhile, the value of PYUSD has dipped to $348 million from $374M, now making up 67.6% of the total.