Paxos Launches New Stablecoin Payments Platform to Boost Adoption

Paxos, the firm behind the Pax Dollar stablecoin, is taking significant steps to enhance stablecoin adoption in the payments industry. On October 15, the company unveiled a new enterprise-grade stablecoin payments platform designed specifically for payment service providers (PSPs) and fintech companies.

In a notable development, Paxos announced that Stripe, a leading global payment processing company, will be the first PSP to integrate this new infrastructure into its system. This integration will be featured on Stripe’s Pay with Crypto product, enabling users to accept stablecoin payments that settle in fiat currencies like the U.S. dollar.

Focus on Payment Providers

The new platform provides an application programming interface (API) infrastructure aimed at facilitating faster and lower-cost global payments compared to traditional methods. A Paxos spokesperson shared that the primary focus is on PSPs and fintech firms that will embed this infrastructure into their systems, rather than direct outreach to individual merchants. Specific merchant requirements will be managed by these providers.

To utilize the platform, customers need to set up a wallet with Paxos. Merchants and PSPs can then choose to receive stablecoins or convert them into fiat currency through Paxos.

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 to expand beyond the U.S. dollar in the future.

Once set up, businesses can accept payments from anywhere, highlighting the global reach of this initiative. Stripe already supports pay-ins from over 70 countries, making it easier for users to engage in stablecoin transactions.

Efficient Payment and Refund Processes

Upon receiving a stablecoin payment, users have the option to either convert the funds to fiat or send stablecoins directly to merchants. Additionally, merchants can issue refunds by converting fiat back into the original stablecoin used for the transaction, sending it directly to the customer’s wallet. This process supports PYUSD and USDP through on-chain transfers on the Solana and Ethereum networks, as well as USDC on Ethereum, Solana, and Polygon.

Paxos emphasizes that its platform provides enterprise-grade infrastructure for payments, adhering to a regulatory-first approach that encompasses onboarding, custody, and money movement. The company aims to continue adding more assets and blockchain options based on customer interests and user preferences.

The Expanding Stablecoin Market

The stablecoin sector has witnessed substantial growth, with the total market value exceeding $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. Many industry players have introduced new stablecoins and related solutions, further expanding the market.

According to Paxos, there’s no fixed amount of stablecoins that should exist. A company representative stated, “Our goal is to keep adding assets and chains over time based on customers’ interests and their own end-user’s preferences.”

Paxos’ new stablecoin payments platform represents a significant advancement in the integration of blockchain technology within the payments industry. By partnering with Stripe and focusing on PSPs and fintech firms, Paxos is well-positioned to drive the adoption of stablecoins in everyday transactions, enhancing both efficiency and user control in the process.