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Arbitrum (ARB) price experiences a significant 10% increase following PayPal’s strategic expansion of its PYUSD stablecoin to the Ethereum Layer-2 network.
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This integration highlights PayPal’s commitment to enhancing blockchain scalability and reducing transaction costs through Arbitrum’s optimistic rollup technology.
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According to COINOTAG, the move builds on PayPal’s prior success with Solana, potentially accelerating Arbitrum’s adoption in decentralized finance.
Arbitrum’s ARB token surges 10% as PayPal extends PYUSD stablecoin support to Ethereum Layer-2, promising lower fees and increased adoption in DeFi.
PayPal’s Arbitrum Integration Fuels 10% Surge for ARB Price
Arbitrum’s native token, ARB, saw a notable price jump to $0.4395, marking a 10.37% increase within 24 hours. This rise positions ARB as the third top gainer among the leading 60 cryptocurrencies, trailing only behind Pump.fun (PUMP) and Pudgy Penguins (PENGU). The catalyst for this momentum is PayPal’s announcement to expand its PYUSD stablecoin to Arbitrum, an Ethereum Layer-2 scaling solution. This development underscores the growing importance of Layer-2 networks in addressing Ethereum’s scalability challenges, offering users faster and more cost-effective transactions.
Arbitrum (ARB) Price Performance. Source: COINOTAG
While PENGU benefits from high-profile endorsements and PUMP leverages a buyback mechanism to reduce circulating supply, Arbitrum’s surge is directly linked to PayPal’s strategic move. By integrating PYUSD onto Arbitrum, PayPal not only broadens the stablecoin’s reach but also enhances the utility of Arbitrum’s network, which is known for its optimistic rollup technology that significantly lowers transaction fees compared to Ethereum’s mainnet.
INTEL: Paypal Plans to Expand PYUSD Stablecoin to Arbitrum Chain
— Solid Intel 📡 (@solidintel_x) July 16, 2025
PYUSD, issued by Paxos, is a US dollar-backed stablecoin initially launched on Ethereum and later expanded to Solana. The addition of Arbitrum as a supported blockchain marks a strategic expansion aimed at leveraging Layer-2 benefits to improve transaction efficiency and user experience.
6/ Why ETH? Lee points to Ethereum’s dominance in stablecoins, tokenized assets and DeFi. He even called stablecoins the “ChatGPT of crypto” because of their viral product-market fit.
— Eric Conner (@econoar) June 30, 2025
How Users Benefit From PayPal Arbitrum Synergy
PayPal’s integration of PYUSD into Arbitrum follows a successful rollout on Solana nearly a year ago, which significantly enhanced the stablecoin’s market presence. Solana’s high throughput and low transaction fees were key factors influencing PayPal’s decision to expand. The Solana integration saw PYUSD’s market capitalization approach $1 billion, with a 45% growth within a month post-expansion.
Arbitrum, recognized as the largest Ethereum Layer-2 network by total value secured (TVS), offers similar advantages. Its optimistic rollup technology reduces congestion and transaction costs on Ethereum, making it an attractive platform for stablecoin transactions. Users transacting PYUSD on Arbitrum can expect faster settlement times and lower fees, which are critical for decentralized finance (DeFi) applications and broader adoption.
Layer 2 Networks on Ethereum are ranked on TVS metrics. Source: L2Beat
Despite these advantages, some market participants remain cautious due to historical concerns about stablecoin sustainability, especially following the collapse of algorithmic stablecoins like Terra’s UST. This skepticism is reflected in PYUSD’s market cap, which has declined nearly 17% from its June 10 peak of $1.01 billion.
PYUSD Market Cap. Source: CoinGecko
It is important to note that PYUSD differs fundamentally from algorithmic stablecoins as it is fully backed by US dollar reserves, ensuring each token is redeemable for an equivalent amount of fiat currency. This backing provides a layer of security and trust that algorithmic models lack, potentially supporting long-term stability and adoption.
Conclusion
The expansion of PayPal’s PYUSD stablecoin to Arbitrum represents a significant milestone in the evolution of Layer-2 blockchain adoption and stablecoin utility. By leveraging Arbitrum’s scalable infrastructure, PayPal enhances transaction efficiency and cost-effectiveness, which could drive broader use cases and increased demand for ARB tokens. While market skepticism persists, the dollar-backed nature of PYUSD and PayPal’s strategic integrations position the stablecoin and Arbitrum network for sustained growth in the competitive DeFi landscape. Investors and users should monitor further developments as this integration unfolds, potentially unlocking new opportunities in Ethereum’s Layer-2 ecosystem.
