PayPal has unveiled a new platform called PYUSDx, developed in partnership with MoonPay and stablecoin platform M0, designed to allow developers to create their own US dollar-pegged tokens backed by PayPal USD (PYUSD). The framework, announced on February 27, 2026, is set for rollout the following month and aims to reduce the technical and operational burden of issuing stablecoins.
PYUSDx is a tokenization and issuance framework offered by MoonPay Digital Assets. It is separate from the core PYUSD stablecoin itself and is intended to help developers launch application-specific stablecoins—digital dollars designed for use within a particular app, ecosystem, or platform. Features include cross-chain compatibility, customizable economic structures, reserve transparency, and the ability to issue branded stablecoins.
"The next phase of stablecoin adoption is happening at the application layer. Developers want to build differentiated experiences, but they shouldn’t have to rebuild trusted monetary infrastructure from scratch," said May Zabaneh, PayPal’s head of crypto. The model allows core monetary infrastructure to remain centralized and regulated through Paxos Trust Company (PYUSD's issuer), while branding and functionality can vary across applications.
The platform significantly reduces launch time, enabling developers to go from testing to launch in days instead of months. The first developer building on PYUSDx is USD.ai, a DeFi protocol that will use the framework to support an application-specific stablecoin tied to AI infrastructure.
It is crucial to note that PYUSDx tokens are distinct from PYUSD itself and cannot be used, sent, or stored within PayPal or Venmo accounts. This separation indicates PayPal's strategy to extend its regulated stablecoin base into external ecosystems while keeping its core consumer applications operationally distinct.
The launch comes as competition in the stablecoin market accelerates, with reports of Meta exploring stablecoin-based payments and various firms racing to embed dollar-backed tokens into workflows. PYUSD, launched in August 2023 and ranking as the sixth-largest stablecoin with roughly $4.2 billion in circulation, has seen growing adoption, including recent integration for YouTube creator payouts.
