PayPal (PYPL) is expanding the role of its PYUSD stablecoin into AI finance, linking it to on-chain financing mechanisms developed by USD.AI, a stablecoin protocol that provides credit to AI companies.
Loans issued by USD.AI to fund graphics processing units (GPUs), data centers and related AI infrastructure will be denominated in PYUSD, and borrowers will be able to receive proceeds directly into PayPal accounts, according to an announcement shared with CoinDesk on Thursday.
The approach aims to combine familiar payment workflows with programmable settlement suitable for long-term financing, rentals and emerging agent-driven transactions. It also demonstrates how stablecoins can be used as settlement instruments for capital-intensive industries beyond cryptocurrencies.
Stablecoins provide a way to move large sums of capital quickly and transparently, while supporting automated payment logic tied to usage or contracts.
The move comes as demand for AI infrastructure increases. Morgan Stanley estimates that global spending on AI computing could reach $6.7 trillion by 2029, putting pressure on capital markets and traditional payment systems. This year, capex for AI will be about $360 billion, UBS said in May.
To encourage adoption, PayPal and the USD.AI Foundation plan to introduce a year-long customer incentive program offering 4.5% on up to $1 billion in deposits starting in early January.
USD.AI secures over $650 million in assets backed by on-chain computing, turning GPUs into tokenized collateral.
