PYUSD yield program offers secure, non-lending rewards for institutions via Anchorage custody.
PYUSD supply grew 60%, now 6th largest USD stablecoin, expanding on Solana, Ethereum.
Anchorage CEO program bridges traditional finance with crypto, boosting institutional adoption.
PayPal and Anchorage Digital are rolling out a new stablecoin rewards program specifically for institutional investors. The program, announced on August 22, will offer yield on PayPal USD (PYUSD) tokens held in Anchorage Digital’s custody solutions. This provides a way for institutions to securely earn rewards without the need for staking or lending.
Today, @Anchorage Digital is pleased to introduce stablecoin rewards on @PayPal’s PYUSD.Earn competitive rewards on PYUSD balances in our secure custody or in our institutional self-custody wallet, Porto.Learn more ⬇️:https://t.co/LtcmXRgnCh pic.twitter.com/0ZyoJSvAkp
— Anchorage Digital (@Anchorage) August 22, 2024
This program is tailored exclusively for institutional clients, allowing them to earn yield on PYUSD tokens stored in Anchorage’s custody, including their self-custody wallet, Porto.
The program prioritizes security, keeping the stablecoins in on-chain accounts. Neither PayPal nor Anchorage will rehypothecate or lend assets to create the rewards. Through their announcement, this approach aims to lower risk for institutions seeking returns on their stablecoin holdings.
This rewards initiative comes as PayPal’s stablecoin, PYUSD, is experiencing steady growth. Its supply has surged over 60% in the past month, recently surpassing USDD to become the sixth-largest USD-backed stablecoin by market cap. PYUSD’s expansion to both Solana and Ethereum blockchains further demonstrates its growth. The circulating supply on Solana is now nearly equal to that on Ethereum.
Nathan McCauley, CEO of Anchorage Digital, emphasized the potential impact of this program on the broader adoption of PYUSD among institutional investors. He noted that the program could help bridge the gap between traditional finance and the digital asset ecosystem, offering a new avenue for institutions to engage with stablecoins.
While currently limited to accredited investors, McCauley suggested in an interview that the program could qualify for a Reg D exemption, potentially allowing broader access without requiring securities registration. Interestingly, the yield payouts will be handled by Anchorage Digital Neo, a Caymans-based entity, instead of Anchorage Digital itself.
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