- PayPal (PYPL, Financial) will introduce a 3.7% annual rewards program for its stablecoin, PayPal USD (PYUSD), starting in Summer 2025.
- The rewards can be used for merchant payments, peer-to-peer transfers, and other financial activities within the PayPal ecosystem.
- The program will be available to U.S. users, excluding those in New York State at launch, and is open to Venmo consumer accounts, but not Teen Accounts or Business Profiles.
PayPal Holdings, Inc. (PYPL) has unveiled a new loyalty program that will offer U.S. users a 3.7% annual reward rate on holdings of its stablecoin, PayPal USD (PYUSD). This initiative is set to launch in Summer 2025 and aims to enhance the utility of PYUSD, encouraging users to integrate the stablecoin into their daily financial transactions.
The program will enable users to earn daily rewards, which will be distributed monthly in PYUSD. Participants can utilize these rewards for merchant payments, peer-to-peer transfers, and additional functions like Xoom remittances and cryptocurrency trading. Furthermore, users have the option to convert PYUSD to fiat currency at a 1:1 ratio or transfer funds to compatible wallets on the Ethereum and Solana blockchains.
This offering is strategically designed to position PayPal's PYUSD as a more competitive and attractive digital asset, particularly when compared to traditional savings products. The rewards system not only promotes the holding of PYUSD but also facilitates its use within PayPal's expansive merchant network, thereby increasing transaction volumes and user engagement.
It is worth noting that while this program is a significant step towards integrating digital currencies into mainstream financial services, it does come with limitations. At launch, the rewards program will not be available to residents of New York State, and it will not include Venmo Teen Accounts or Business Profiles. PayPal also retains the flexibility to adjust the reward rate at its discretion.
