PayPal USD [PYUSD] continues attracting new users even though the circulating supply remains low. Santiment data shows that PYUSD recorded 863 new wallets in a single day. That was the strongest network growth since the 8th of April.
However, despite growth in the network, the market capitalization of PYUSD is roughly 24% lower from late May, near $2.73 billion. This divergence suggests adoption among users is recovering faster than the supply is circulating.
Holder counts continue to rise on major networks as well. This trend also suggests participation goes beyond short-term speculative demand.
PayPal also continues to expand its payment ecosystem through support for merchant settlements and Polygon native support. Those developments also strengthen the utility behind recent growth in wallet use.
Together, a stronger network activity is showing adoption driven more and more by real usage. Meanwhile, supply recovery lags behind, and this suggests healthier expansion that is not solely powered by the issuance of stablecoins.
Stablecoin adoption broadens
Recent results from Circle further highlight a growing gap between network activity and liquidity in broader stablecoin markets overall. Results from Circle’s latest report reinforce this trend without fundamentally changing the story.
Although USDC circulation grew 19% year over year to $73.3 billion, on-chain transaction volume expanded 151% to $14.8 trillion, showing network usage continues accelerating much faster than supply.
That widening gap suggests existing liquidity is being used more efficiently rather than just issuing new liquidity. The renewed partnership with Coinbase also supports this shift by strengthening the roles of USDC across exchanges and institutional and payment infrastructure.
Together, these developments show that stablecoin adoption is increasingly judged by transaction speed and settlement activity rather than just circulating supply alone.
Stablecoin adoption outpaces liquidity
That shift becomes even more meaningful when viewed against the broader stablecoin market. Total stablecoin market capitalization has declined by roughly $16 billion over the past three months, leaving overall liquidity noticeably thinner.
Yet the earlier trends in PYUSD and USDC suggest adoption has continued despite that contraction. Instead of relying on expanding supply, leading stablecoins are generating growth through higher transaction activity, broader distribution, and stronger payment utility.
The contrast highlights an important shift in market structure. Liquidity is no longer the only measure of ecosystem strength. As capital becomes more selective, network usage and settlement demand increasingly distinguish the strongest issuers.
That evolution suggests stablecoins are gradually transitioning from speculative liquidity instruments toward core financial infrastructure for payments and digital settlement.
Final Summary
- PayPal USD [PYUSD] and USD Coin [USDC] expanded usage despite a $16 billion decline in stablecoin market liquidity.
- PYUSD and USDC show stablecoin growth is shifting from supply expansion toward payments, settlement, and active network use.