Paxos, the blockchain firm behind the Pax Dollar stablecoin, is making strides to expand stablecoin adoption in the payments industry through its innovative enterprise-grade infrastructure. The company has launched a new stablecoin payments platform aimed specifically at payment service providers (PSPs) and fintech companies eager to facilitate stablecoin transactions.
Partnership with Stripe
On October 15, Paxos announced that Stripe, a leading global payment processing company, would be the first PSP to integrate this new infrastructure into its system. This collaboration will feature Paxos’ technology in Stripe’s Pay with Crypto product, allowing users to accept stablecoin payments that settle in fiat currencies such as the U.S. dollar.
Paxos’ stablecoin payment platform provides an application programming interface (API) designed to enable faster and more cost-effective global payments compared to traditional payment methods.
“We’re currently focused on PSPs, fintechs, and other providers who will embed this infrastructure into their systems, rather than individual merchant outreach, so specific merchant requirements are up to each provider,” a Paxos spokesperson explained to Cointelegraph.
To utilize the platform, customers must set up a wallet with Paxos. Once established, merchants and PSPs can choose to receive stablecoins or convert their funds to fiat currency via Paxos.
Support for Multiple Stablecoins
At launch, Paxos’ stablecoin platform supports conversions between the U.S. dollar and three stablecoins: Pax Dollar (USDP), PayPal USD (PYUSD), and Circle’s USD Coin (USDC). Currently, the platform is available in the United States, with plans for future expansion beyond the U.S. dollar.
“Once set up, businesses can accept payments from anywhere, emphasizing the global power of this work,” a representative from Paxos stated. Stripe already supports pay-ins from over 70 countries, making it a potent partner for this initiative.
Once a stablecoin payment is processed, users have the option to convert the funds to fiat or send stablecoins directly to merchants. Furthermore, merchants can issue refunds by converting fiat back into the stablecoin originally used and transferring it directly to the wallet that was involved in the initial payment. This feature supports transactions involving PYUSD and USDP via on-chain transfers across the Solana and Ethereum networks, as well as USDC on Ethereum, Solana, and Polygon.
“This is truly enterprise-grade infrastructure for payments, where Paxos brings our regulatory-first approach to the payment capabilities needed across onboarding, custody, and money movement,” Paxos emphasized. This highlights the company’s commitment to ensuring compliance while enhancing payment solutions in the crypto space.
Growth of the Stablecoin Industry
The stablecoin sector has seen significant growth over the past few years, with the total market value of all stablecoins surpassing $170 billion in September. Tether, the operator of the largest stablecoin, USDt, reported a record-breaking $5.2 billion profit in the first half of 2024. In response to this growing demand, numerous industry firms have introduced new stablecoins and related solutions.
According to Paxos, there is no definitive “right” number of stablecoins that should exist in the market. A company representative noted,
“Without respect to the right number, our goal is to keep adding assets and chains over time based on customers’ interests and their own end-user preferences.”
This openness to expansion suggests that Paxos is committed to meeting the evolving needs of its clients and the broader market.
Paxos’ new stablecoin payment platform, in partnership with Stripe, represents a significant development in the push for stablecoin adoption in the payments sector. By providing an API infrastructure that enables quicker and cheaper transactions, the platform is poised to attract PSPs and fintech companies looking to enhance their service offerings.
As the stablecoin market continues to grow, initiatives like this one will play a crucial role in integrating digital assets into mainstream finance. With Paxos’ regulatory-first approach and ongoing commitment to expanding its offerings, the company is well-positioned to lead in the evolving landscape of cryptocurrency payments.
| Feature | Details |
|---|---|
| Partner | Stripe |
| Supported Stablecoins | USDP, PYUSD, USDC |
| API Infrastructure | Enables fast and cost-effective payments |
| Refund Process | Allows conversion from fiat back to stablecoin |
| Current Availability | Primarily in the U.S. |
| Future Plans | Expand support beyond USD |
| Stablecoin Market Value | Surpassed $170 billion |
| Tether’s H1 2024 Profit | $5.2 billion |
Featured image credit: studiogstock via Freepik
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