Paxos, PayPal’s blockchain partner, accidentally minted $300 trillion worth of stablecoins Wednesday in what it called a “technical error,” quietly burning the tokens just minutes later.
Market watchers pointed out the blunder after they noticed a huge influx of PayPal’s PYUSD on Etherscan, an analytics platform for the Ethereum blockchain that allows users to view all data on the network.
“Paxos immediately identified the error and burned the excess PYUSD,” the crypto platform said on social media.
“This was an internal technical error. There is no security breach. Customer funds are safe. We have addressed the root cause.”
The company said it mistakenly minted the coins – hypothetically worth more than twice the entire world’s GDP – during an internal transfer.
Paxos fixed the mistake after about 20 minutes, according to Etherscan.
PayPal did not immediately respond to The Post’s request for comment.
PayPal’s stablecoin is pegged to the US dollar on a 1:1 basis, backed by US dollar deposits and US treasuries.
There aren’t enough US dollars in circulation to back $300 trillion worth of stablecoins.
Rather, the dollar peg is guaranteed by PayPal.
Its stablecoin is currently the sixth largest in the world, with a market capitalization of more than $2.6 billion, according to CoinMarketCap.
Mistakes in the cryptocurrency world are often permanent.
Sending Bitcoin to the wrong person, for example, is irreversible, and lost crypto wallet passwords can cost investors millions.
But stablecoin issuers have much more control over these transactions, with the power to create or delete billions in digital assets on a dime.
It’s part of the reason why stablecoins have been growing more mainstream, adopted by an increasing number of banks and payment platforms.
Paxos’ $300 trillion slip-up isn’t the first incident of mistaken minting in the stablecoin space.
In 2019, Tether accidentally minted $5 billion worth of its stablecoin called USDT.
It quickly burned the tokens.
