Paxos Accidentally Mints $300 Trillion of PayPal’s Stablecoin in Technical Glitch

Paxos, the blockchain infrastructure partner for PayPal, inadvertently created $300 trillion worth of the payment firm’s PYUSD stablecoin on Wednesday, an event the issuer described as a “technical error.” Observers spotted the large issuance on Etherscan, the public explorer and analytics service for the Ethereum network.

According to Paxos, the tokens were minted during an internal transfer. The company said it “immediately identified the error and burned the excess PYUSD,” adding that the incident did not reflect a security breach and that customer funds remained protected. “This was an internal technical error. There is no security breach. Customer funds are safe. We have addressed the root cause,” Paxos said in a social media statement. Public transaction records on Etherscan indicate the error was corrected in roughly 20 minutes.

PYUSD is promoted as a dollar-pegged stablecoin backed by U.S. dollar deposits, U.S. Treasury securities and comparable cash equivalents, and PayPal states the tokens are redeemable at a one-to-one ratio for U.S. dollars. The episode underlines that the dollar peg rests on PayPal’s backing and third-party attestation reports rather than on any mechanical impossibility of overissuance. There are far fewer physical dollars in circulation than the sum represented by $300 trillion of PYUSD, a figure that would, in theory, require more than double the world’s estimated total GDP.

The error occurred as stablecoins gain broader adoption among banks and payments platforms. PYUSD currently ranks as the sixth-largest stablecoin, with a market capitalisation exceeding $2.6 billion, according to CoinMarketCap.