Are stablecoins really viable? Paypal minted 300 trillion on Ethereum

In the early morning of October 15th, Beijing time, the US stablecoin and payment giant Paypal caused a big mistake:

Cointelegraph also stated: Congratulations to PayPal for becoming the richest company on the planet, with assets of 300 trillion US dollars... This lasted for about 20 minutes, until Paxos burned its newly minted PYUSD stablecoin worth 300 trillion US dollars. Many people may not have any idea of ​​what $300 trillion means. You should know that the GDP of all countries in the world combined in 2024 will only be $100 trillion. With this operation, Paypal directly issued all the wealth created on Earth in the past three years!

Fortunately, the blockchain ledger cannot be tampered with. I've listed the transfer hash of this historic event here for interested friends to see~

Minting Hash:

0xc45dd1a77c05d9ae5b2284eea5393ecce2ac8a7e88e973c6ba3fe7a18bf45634

Destroy Hash:

Strictly speaking, PYUSD (PayPal USD) is a compliant US dollar stablecoin issued by the US fintech company Paxos Trust Company and supported by the PayPal brand.

Therefore, it can be said that the real issuer of PYUSD is Paxos Trust Company, which was founded in 2012, is headquartered in New York, and holds a trust license from the New York State Department of Financial Services (NYDFS).

Paxos is also a company that claims to be compliant:

• is one of the few stablecoin issuers approved by official US regulators;

• is responsible for issuing, clearing, and custodial US dollar reserves;

• regularly publishes audit reports to ensure that there is a real US dollar or equivalent government bond behind every PYUSD. Paxos previously issued the BUSD stablecoin for Binance, but was ordered to cease issuance by the New York Department of Financial Services in 2023. Since then, it has shifted its focus to partnering with compliant brands, such as PayPal. It's no surprise that Paxos is the most knowledgeable blockchain provider in the traditional financial world. It helps banks and payment giants move US dollars onto blockchain while ensuring regulatory compliance. PayPal is one of the world's largest electronic payment platforms, with over 400 million users. In the past few years, it has gradually laid out its presence in the field of encrypted payments:

  

  The core selling point of PYUSD is "compliant, secure, and regulated." Although this blunder was merely a technical issue, it exposed:

  • the risk of human error in contract operations;

  • the issuer's transparency mechanism is not perfect;

  • the communication mechanism between PayPal and Paxos is somewhat slow (destruction within 20 minutes).

  This is a negative signal for institutional investors and the traditional financial community.

  

  Especially since the crypto market just experienced an extreme market crash like 1011 a few days ago, and now stablecoin issuers under the banner of compliance have created sky-high wealth out of thin air

  They may be even more skeptical:

  "Are you crypto people reliable?"