Glitch Leads Paxos to Mint $300 Trillion in PayPal Stablecoin Before Quick Burn
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A brief but stunning technical glitch at Paxos on Wednesday led to the creation of 300 trillion PayPal USD (PYUSD) - an amount surpassing the entire global GDP - before the stablecoin issuer swiftly reversed the mistake.
The error occurred around 3:12 p.m. ET, when Paxos’s hot wallet inadvertently minted the tokens and sent them to PayPal’s PYUSD smart contract on Ethereum.
Within half an hour, the company identified and burned the excess tokens, assuring users that no breach had occurred and customer assets remained secure.
“There was no hack, no loss of funds – the issue was purely technical and has been resolved,” Paxos noted on X, adding that the root cause had been fixed to prevent future incidents.
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The temporary minting briefly rattled decentralized finance markets. Aave froze PYUSD trading as a precaution, while the token briefly lost its $1 peg before stabilizing once the burn was confirmed. Paxos later carried out a separate, legitimate mint of 300 million PYUSD as part of routine operations.
Despite the turbulence, PYUSD remains the sixth-largest stablecoin globally.
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