Crypto Chaos: Paxos Mistakenly Mints $300 Trillion PYUSD on Ethereum
On Wednesday, stablecoin issuer Paxos mistakenly minted an astounding $300 trillion worth of PayPal’s PYUSD stablecoin on the Ethereum blockchain — far exceeding the total U.S. dollar supply of $2.4 trillion and more than 2.5 times the world’s GDP, which stands at approximately $117 trillion, according to the International Monetary Fund.
The transaction cost just $2.66 in Ethereum fees to create this gargantuan sum — a dramatic illustration of how quickly errors can propagate on blockchain networks.
“At 3:12 PM EST, Paxos mistakenly minted excess PYUSD as part of an internal transfer. Paxos immediately identified the error and burned the excess PYUSD,” the issuer announced on X.
All 300 trillion PYUSD tokens were “burned,” or effectively destroyed around 20 minutes later, by sending them to an inaccessible network address.
Paxos explained that a technical glitch caused the PYUSD supply to expand unintentionally, but the error was quickly corrected. The company stressed that no security breach occurred and that all customer funds remain fully safe.
The incident has raised concerns in the crypto community about collateralized stablecoins being minted without the required backing. Pseudonymous market commentator VBL’s Ghost noted on X:
“It’s not the dollar amount you should be thinking about. It’s the fact that this is a collateralized asset that can be created without the collateral.”
At the time of the incident, PYUSD ranked as the world’s seventh-largest stablecoin, with a market value of approximately $2.64 billion, fully backed by high-quality, liquid reserve assets to maintain its 1:1 peg with the U.S. dollar.
This is not the first time a fat finger error has affected the stablecoin market. In 2019, Tether (USDT) mistakenly minted and quickly destroyed $5 billion, highlighting the potential risks of automated stablecoin issuance.
