Paxos Glitch Briefly Creates $300 Trillion in PayPal Stablecoin
Paxos briefly minted $300 trillion in PayPal’s PYUSD due to an internal glitch, later burning the tokens and assuring funds were safe.
In an extraordinary yet short-lived incident, blockchain infrastructure firm Paxos accidentally minted $300 trillion worth of PayPal USD (PYUSD), triggering astonishment across the crypto community before quickly reversing the error. The company, which issues PayPal’s U.S. dollar–backed stablecoin, confirmed the mishap occurred during an internal transfer on Wednesday afternoon and was resolved within minutes.
“At 3:12 PM EST, Paxos mistakenly minted excess PYUSD as part of an internal transfer,” the company said in a post on X. “Paxos immediately identified the error and burned the excess PYUSD. There is no security breach. Customer funds are safe.”
According to a CNBC report, the total minted — roughly $300 trillion — surpassed not only the amount of physical dollars in circulation but also more than doubled the world’s total gross domestic product. While the number itself raised eyebrows, the firm emphasized that no real funds or collateral were affected, framing the issue as an “internal technical error.” The glitch lasted about 20 minutes before Paxos corrected the ledger and restored normal operations.
The event offered a dramatic reminder of the scale at which blockchain-based financial infrastructure operates. Although digital ledgers are often praised for their precision, errors like this underscore the complexity of automated minting mechanisms — especially when handled by major issuers that partner with global payment giants.
PayPal, which launched PYUSD in August 2023, has not yet commented on the incident. The stablecoin currently has a circulating market cap of about $2.6 billion, making it the sixth largest in the world. PYUSD is fully backed by U.S. dollar deposits, short-term Treasury bills, and equivalent cash reserves, according to Paxos.
Paxos operates under oversight from the New York Department of Financial Services (NYDFS), which regulates its issuance of digital assets and ensures 1:1 redemption of tokens. The company also issues other dollar-backed stablecoins such as USDP, USDG, and USDL, in addition to PAXG, a gold-backed token.
Earlier this year, Paxos reached a $48.5 million settlement with the NYDFS over deficiencies in its compliance and anti–money laundering programs. As part of the agreement, the firm pledged to invest $22 million into strengthening its compliance infrastructure.
While the $300 trillion incident did not cause any market disruption, it has reignited conversations around transparency, auditing, and risk controls in stablecoin operations. As regulators worldwide tighten scrutiny on digital asset issuers, even a harmless internal error can fuel concerns over reliability and oversight.
For now, Paxos insists the matter is fully resolved. But for an ecosystem still fighting for public trust, the image of an accidental $300 trillion minting spree will likely linger as a cautionary tale about the limits of automation in digital finance.
