Payments giant PayPal completed its first business payment using its stablecoin, PYUSD, on September 23.
The company paid an invoice to Ernst & Young LLP, using SAP SE’s digital currency hub, which allows for instant payments 24/7.
The invoice amount was not revealed by the company. PYUSD, which was launched last year, is pegged to the US dollar and had a market cap of around $700 million at press time.
Stablecoins in business payments
Jose Fernandez da Ponte, PayPal’s senior vice president of blockchain, cryptocurrency, and digital currency, emphasized how well-suited stablecoins are for the business environment.
He said that using PYUSD for B2B transactions offers a rational choice for CFOs. Businesses worldwide are increasingly relying on stablecoins for cross-border payments.
These payments usually take time and can be risky due to the involvement of third parties. However, blockchain allows for faster settlements.
Countries with super volatile currencies are turning to stablecoins to manage their transactions more effectively.
Earlier this year, BVNK, a payments platform, started letting businesses send US dollars to its platform using SWIFT.
Once there, they can convert it into stablecoins to make payments to partners worldwide.
In September, PayPal announced that it would allow merchants to buy, hold, and sell crypto directly from their business accounts.
The company continues to post solid financial results. In Q3, PayPal reported $9.08 billion in revenue, a 12% jump from the same period last year.
This growth is driven by increased user engagement and transaction volume. The company’s net income for Q3 hit $1.64 billion, giving it a net income margin of 18%.
Earnings per share (EPS) also grew, hitting $1.25 compared to $1.10 in Q3 2023. Operating expenses for the quarter reached $6.56 billion.
This includes $1.2 billion spent on research and development, as well as $2.9 billion on general and administrative costs.
Despite these high costs, PayPal’s gross profit for Q3 was $2.52 billion, giving the company a gross profit margin of 27.8%.
PayPal’s active accounts reached 500 million, up from 480 million year-to-date. The total payment volume (TPV) processed during the quarter was $355 billion, up 10% from last year.