Protected Transactions using PayPal’s PYUSD Stablecoin on Solana Platform

Private transactions enable businesses to offer privacy to their customers regarding the amounts of their transactions while also remaining compliant with regulations.

PayPal has launched its PYUSD stablecoin on Solana, with the added capability of “confidential transfers.”

On May 29, PayPal’s payment platform shared that its PYUSD stablecoin, which is pegged to the dollar, is now available on Solana, expanding its previous availability only on Ethereum.

A noteworthy addition introduced to PYUSD is called “secret transactions,” which enables merchants to offer their customers confidentiality for transaction amounts while still being visible for regulatory purposes, as stated in a May 29 blog post by Solana.

Udi Wertheimer, a proponent of Bitcoin, expressed skepticism on May 29 about PayPal’s upcoming feature, stating that it resembles the long-awaited “confidential transactions” that Bitcoin developers have discussed for years but have yet to implement. He found it amusing that this feature will be available to PayPal users before being implemented in Bitcoin.

“So by expanding to Solana, we can improve the network’s speed and provide better services.

Mert Mumtaz, CEO of Helius Labs, stated that the reason for Paypal’s expansion to Solana was not only for its speed. He also mentioned that by expanding to Solana, they can enhance the network’s speed and offer better services.

“Additionally, Solana enables the capability for confidential transfers and token programmability directly on L1. This feature alone has the potential to be transformative.”

More options for programming are now available through the use of “transfer hooks”, which allows for specific programs to be called for every token transfer, providing greater management over the asset for wallets.

PayPal now offers the conversion of PYUSD stablecoin into USD for cross-border transfers.

The company stated that Solana’s token extension standard, which ensures adherence to the SPL token standard, provides advantageous compliance frameworks for the PayPal stablecoin.

Some benefits are decreased development and testing, compatibility for businesses, and adaptability.

The Solana Foundation stated that TEs (token extensions) are a publicly available format that enables PYUSD to be incorporated and utilized beyond the PayPal system, with any supporting wallet, exchange, or library.

Paxos launched PYUSD in August 2023, which is mainly supported by Reverse Repurchase Agreements from the U.S. Treasury.