$300 trillion worth of PYUSD stablecoins were mistakenly minted due to a technical error

Paxos, the blockchain partner of online payment giant PayPal, accidentally minted a huge amount of stablecoins worth $300 trillion on October 15 due to a technical error.

Paxos, the blockchain technology partner of online payment giant PayPal, accidentally minted a huge amount of stablecoins worth $300 trillion on October 15 due to a technical error, according to the company's statement.

Market watchers spotted an unusual injection of the PayPal stablecoin PYUSD on Etherscan, a blockchain tracker dedicated to the ethereum ecosystem.

In a statement on social media, Paxos said it mistakenly minted the stablecoin in an internal transaction, but immediately detected and corrected it by burning the excess PYUSD.

Paxos insists this was an internal technical error and that there was no security breach. The company emphasizes that customer funds are safe while Paxos addresses the root cause of the problem.

PYUSD is advertised as a 1:1 USD-pegged stablecoin, fully backed by USD deposits, US Treasury bonds and cash equivalents. Therefore, PayPal promises that the token can always be redeemed for USD at a 1:1 ratio.

However, this technical error has highlighted the fact that the USD peg needs to be guaranteed by PayPal itself and requires independent third-party verification reports, rather than being intrinsically linked to the stablecoin minting process.

Theoretically, 300,000 billion PYUSD is equivalent to the amount of USD in circulation, which is twice the estimated Gross Domestic Product (GDP) of the entire world .

Paxos's incident comes at a time when stablecoins are becoming increasingly popular as they are accepted by more banks and payment platforms.

PYUSD is currently the world's sixth-largest stablecoin, with a market capitalization of more than $2.6 billion, according to data from CoinMarketCap./.

(TTXVN/Vietnam+)

Source: https://www.vietnamplus.vn/duc-nham-stablecoin-pyusd-tri-gia-300000-ty-usd-do-loi-ky-thuat-post1070902.vnp