PYUSD0 is a permissionless, omnichain version of PayPal's stablecoin, PayPal USD (PYUSD), designed to be fully fungible and interoperable across multiple blockchain networks. It was created through a strategic integration with the crypto infrastructure firm LayerZero Labs to expand PYUSD's accessibility and utility within the decentralized finance (DeFi) ecosystem.

Overview

PYUSD0 was introduced on September 18, 2025, as a significant expansion of PayPal's stablecoin strategy. The core purpose of PYUSD0 is to allow the U.S. dollar-pegged stablecoin, PYUSD, to move seamlessly between different blockchain ecosystems without relying on centralized intermediaries or complex wrapping procedures. The initiative leverages LayerZero's Omnichain Fungible Token (OFT) standard, which ensures that the token maintains its economic identity and value parity across all supported chains. This creates a unified user experience, where PYUSD0 on one blockchain is treated as identical to native PYUSD on another. ^{[1] [2]}

The expansion aims to address a key challenge for stablecoins: fragmentation across different networks. By creating a single, interoperable standard, PayPal and LayerZero seek to enhance PYUSD's utility for a broader base of users, particularly those involved in DeFi and decentralized applications (dApps) on various high-activity blockchains. The underlying PYUSD, which PYUSD0 represents, is issued by Paxos Trust Company and is backed by U.S. dollar deposits, U.S. Treasuries, and other cash equivalents. The integration allows users who self-custody their assets to transfer value across chains in a trustless manner, governed by smart contracts rather than centralized entities. ^{[3] [4]}

History

The development of PYUSD0 follows the initial launch and gradual expansion of its parent asset, PayPal USD (PYUSD). PayPal first introduced PYUSD in August 2023, initially deploying it on the Ethereum blockchain. Following its launch, the stablecoin's native support was extended to other networks, including the Solana blockchain and the Ethereum Layer 2 scaling solution, Arbitrum. ^{[5] [2]}

A significant contextual event was the signing of the GENIUS Act in July 2025, a comprehensive stablecoin law that provided a new regulatory framework for the market and was seen as a catalyst for increased institutional adoption. On September 18, 2025, PayPal, in partnership with LayerZero Labs, officially announced the creation of PYUSD0. This move expanded PYUSD's presence to nine additional blockchains and involved upgrading its existing permissionless versions on two other chains to the new PYUSD0 standard. The announcement coincided with a separate, non-LayerZero integration that brought PYUSD to the Stellar blockchain, further broadening its ecosystem reach. ^{[1] [4]}

Technology

The functionality of PYUSD0 is built upon a combination of technologies provided by LayerZero Labs, designed to facilitate secure and efficient cross-chain asset transfers.

Core Infrastructure

PYUSD0 is an implementation of LayerZero's Omnichain Fungible Token (OFT) standard. The OFT standard is a smart contract framework that enables a token to exist natively across multiple blockchains while maintaining a single, unified supply. It works by wrapping a native token on a source chain and allowing for the minting of an identical, fungible token on a destination chain. This process is managed by LayerZero's cross-chain messaging protocol, which ensures that the total supply of the asset remains constant across all integrated networks. ^{[1] [2]}

The distribution and management of PYUSD0 across chains are facilitated by the Stargate Hydra model. Stargate, a decentralized finance protocol and cross-chain bridge built on LayerZero, serves as the primary user-facing interface for transferring PYUSD0. The Hydra extension allows an asset from a "hub" blockchain to be extended to multiple "spoke" blockchains, handling the cross-chain minting, burning, and deployment of the token. This architecture is composed of three key layers:

• Asset: The underlying PayPal USD (PYUSD) stablecoin issued by Paxos.
• Interface: Stargate, which provides the application for users to execute transfers between chains.
• Rails: LayerZero, the fundamental infrastructure that enables the secure communication and asset fungibility across networks. ^{[4] [2]}

Mechanism of Operation

PYUSD0 operates as a permissionless, bridged representation of the native PYUSD token. When a user wishes to move PYUSD from a native chain like Ethereum to a new network like Avalanche, the LayerZero protocol facilitates the locking of the native PYUSD in a smart contract on the source chain and the minting of an equivalent amount of PYUSD0 on the destination chain. Conversely, when moving PYUSD0 back to a native chain, the PYUSD0 is burned on the source chain, and the corresponding native PYUSD is unlocked on the destination chain. This burn-and-mint mechanism ensures that every PYUSD0 token is always fully backed by a native PYUSD token, preserving the 1:1 peg to the U.S. dollar. The entire process is governed by smart contracts, which reduces the counterparty risk associated with centralized bridging solutions that rely on trusted intermediaries. ^[3]

Blockchain Support

The introduction of PYUSD0 significantly expanded the number of blockchains where PayPal's stablecoin is available. The ecosystem is divided between chains with native PYUSD support and those supported through the LayerZero integration.

• New Chains via PYUSD0:
  • Tron
  • Avalanche
  • Aptos (noted as the "Move-chain launch partner")
  • Abstract
  • Ink
  • Sei
  • Stable
• Chains Upgraded to PYUSD0:
  • Berachain (upgraded from the previous BBYUSD token)
  • Flow (upgraded from the previous USDF token)
• Native PYUSD Chains (for context):
  • Ethereum
  • Solana
  • Arbitrum
  • Stellar

This expansion brought the total number of blockchains supporting a version of PYUSD to over a dozen. ^{[4] [2]}

Partnerships

The creation and launch of PYUSD0 are the result of a primary collaboration between several key entities in the financial technology and blockchain sectors.

• PayPal: As the creator of the parent asset, PayPal provides the brand recognition and established user base for the PYUSD stablecoin. The initiative is led by its ecosystem division.
• LayerZero Labs: The core technology partner, LayerZero Labs provides the underlying omnichain infrastructure, including the OFT standard and cross-chain messaging protocol that powers PYUSD0.
• Paxos Trust Company: As the issuer of the native PYUSD, Paxos is a crucial partner responsible for managing the reserves that back the stablecoin. It is regulated by the New York State Department of Financial Services (NYDFS).
• Stargate: The decentralized finance protocol serves as the key interface for PYUSD0, with its Hydra bridge enabling the distribution and transfer of the token across the supported networks. ^{[5] [2]}