PayPal, MoonPay, M0 Launch PYUSDx to Create App Stablecoins

PYUSDx, a new tokenization and issuance framework backed by PayPal USD, was unveiled on Friday by PayPal, MoonPay, and stablecoin infrastructure provider M0. The product lets developers spin up their own US dollar-pegged stablecoins for use within specific applications or platforms, with the companies targeting a rollout next month, according to a joint announcement shared with reporters.

What Is PYUSDx and How Does It Work?

PYUSDx is a tokenization and issuance framework offered by MoonPay Digital Assets that enables developers to create application-specific stablecoins anchored to PayPal USD. The platform combines M0's universal stablecoin and digital token infrastructure with MoonPay Group's operational toolkit, reducing the technical hurdles of launching a new stablecoin. Key features include fast deployment, cross-chain compatibility, flexible economics, reserve transparency, and support for branded stablecoins.

The framework is distinct from PYUSD itself. PYUSDx tokens cannot be used, sent, or stored in PayPal or Venmo accounts, the companies emphasized. PayPal USD, the reserve asset underpinning PYUSDx, was introduced in August 2023 and is issued by Paxos Trust Company, a federally regulated national banking association.

The next phase of stablecoin adoption is happening at the application layer. Developers want to build differentiated experiences, but they shouldn't have to rebuild trusted monetary infrastructure from scratch.

— May Zabaneh, PayPal's Head of Crypto

USD.ai Becomes First Developer on PYUSDx

USD.ai, a decentralized finance protocol behind the USDai and yield-bearing sUSDai stablecoins, is the inaugural builder on PYUSDx. The protocol is using the framework to support an application-specific stablecoin for AI infrastructure, marking an early intersection between stablecoin tooling and artificial intelligence.

PayPal's Zabaneh said the company is excited to see MoonPay and M0 use PYUSDx to bring new, application-specific stablecoins to market anchored in a regulated, trusted foundation.

Stablecoin Competition Heats Up

The unveiling of PYUSDx arrives amid rising competition in the stablecoin sector. Meta has reportedly been exploring stablecoin-based payment integrations across its apps, including Facebook, Instagram, and WhatsApp, signaling that major technology firms view digital dollar tokens as the next frontier for consumer payments.

PayPal has meanwhile continued broadening real-world adoption of its flagship stablecoin. In late 2025, video-sharing giant YouTube reportedly enabled US-based creators to accept payouts in PYUSD, highlighting the digital dollar's growing traction beyond traditional financial services.

What This Means Going Forward

PYUSDx positions PayPal at the center of a trend where payment companies provide infrastructure rather than end-user products alone. By letting any developer mint a branded stablecoin with PYUSD reserves, PayPal could embed its digital dollar into thousands of applications without direct consumer engagement. If the next month rollout proceeds as planned, PYUSDx may accelerate the fragmentation of the stablecoin market into specialized, app-layer tokens while consolidating reserve-level dominance around regulated issuers like Paxos.