$300 Trillion Stablecoins Minted Out of Thin Air: Paxos Accidentally Mints Trillions in PayPal PYUSD Tokens

For a brief moment on Wednesday, the blockchain tied to PayPal’s stablecoin looked like something out of science fiction. Paxos, the crypto company that issues the PayPal USD (PYUSD) token, accidentally minted $300 trillion worth of the stablecoin — an amount larger than the entire global economy — before realizing the mistake and deleting it from existence, according to CNBC.

Market watchers on Etherscan, a popular blockchain explorer, were the first to spot the astronomical number. It wasn’t long before screenshots spread across social media showing the minting event that briefly flooded the Ethereum network with a flood of PYUSD tokens.

Paxos quickly addressed the issue, explaining that the mint was caused by a “technical error” during an internal transfer. “This was an internal technical error. There is no security breach. Customer funds are safe. We have addressed the root cause,” the company wrote in a statement. Within 20 minutes, the phantom trillions had been burned — blockchain-speak for permanently removed — restoring PYUSD’s supply to normal.

“Paxos, the blockchain partner of PayPal, mistakenly minted $300 trillion worth of the online payment giant’s stablecoin on Wednesday in what the company called a ‘technical error,'” CNBC reported.

Paxos Glitch Mints $300 Trillion in PayPal PYUSD, Highlighting Stablecoin Risks

“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. This was an internal technical error. There is no security breach. Customer funds are safe. We have addressed the root cause,” Paxos wrote in a post on X.

The glitch quickly ignited questions from many on X about the danger of stablecoins, with one user responding to Paxos’ post saying, “If stable coins can be accidentally created without backing and then ‘burnt’ to make them magically disappear, think of what they can do to your supposedly stable coins?”

PayPal didn’t immediately respond to requests for comment, but the error served as a strange reminder of how digital money, for all its precision, can still produce absurd moments. Stablecoins like PYUSD are meant to maintain a 1:1 peg with the U.S. dollar and are fully backed by cash equivalents such as dollar deposits and Treasury bills. However, this incident revealed that the minting process itself isn’t inherently tied to those reserves — meaning a technical error can momentarily create tokens far exceeding the value they represent.

Had the $300 trillion been real, it would have required more than double the total GDP of the entire planet to back it. The glitch, while quickly fixed, raised new questions about safeguards in systems handling token issuance at a massive scale.

The timing is interesting. Stablecoins are becoming increasingly mainstream, as payment companies and banks seek to integrate crypto rails with traditional finance. PYUSD, with a market cap above $2.6 billion, ranks as the sixth-largest stablecoin globally, according to CoinMarketCap.

Paxos, founded in 2013 by Charles Cascarilla and Richmond Teo, has been a key player in regulated blockchain infrastructure. The firm previously issued Binance USD (BUSD) before New York regulators ordered it to stop new issuances last year over oversight concerns tied to Binance. Beyond stablecoins, Paxos’ core platform, Bankchain, focuses on blockchain-based settlements aimed at reducing counterparty risk and speeding up post-trade operations across capital markets.

For now, Paxos can breathe easy knowing the $300 trillion glitch didn’t turn into a full-blown crisis. But it’s a vivid reminder that even in the most tightly monitored corners of blockchain, a small bug can briefly make the impossible real.