PayPal’s crypto partner mints $300 trillion stablecoins in ‘technical error’

Blockchain partner Paxos PayPalOn Wednesday, it accidentally minted $300 trillion of the online payments giant’s stablecoin, and the company called it a “technical error.”

Market watchers had noticed the massive injection of PayPal PYUSD stablecoin. Ether scan — A block explorer and analysis platform for the Ethereum blockchain.

The company said in a statement that Paxos mistakenly minted stablecoins as part of an internal transfer before “immediately detecting the error and burning the excess PYUSD.” social media statement.

“This was an internal technical error. There was no security breach. Customer funds are safe. We have addressed the root cause,” he added. PayPal did not respond to a question from CNBC outside normal business hours.

Transactions on Etherscan showed that the error was fixed after about 20 minutes.

PYUSD is announced as follows: stablecoin pegged to the dollar It is fully backed by U.S. dollar deposits, U.S. Treasury securities and similar cash equivalents. Therefore, PayPal says tokens can always be converted to US dollars on a 1:1 basis.

However, the technical error highlights that the dollar peg is guaranteed by PayPal and its independent third party certification reportsrather than being inherently tied to the minting of a stablecoin.

There are not enough dollars in global circulation to support PYUSD 300 trillion; This would theoretically require more than double the world’s estimated total GDP.

Paxos’ bug comes at a time when stablecoins are becoming more mainstream, with adoption by a growing number of banks and payment platforms.

PYUSD is currently the sixth largest stablecoin in the world with a market capitalization of over $2.6 billion. data From CoinMarketCap.