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Blockchain infrastructure firm Paxos, the issuer of the PayPal USD (PYUSD) stablecoin, recently made history for an altogether unintended reason: the largest accidental token mint of all time. On Wednesday, the company mistakenly created a staggering 300 trillion PYUSD tokens during an internal transfer.
Mistake Dwarfs US Money Supply
[embed]https://twitter.com/Paxos/status/1978565015943950411[/embed] The immense scale of this error is difficult to comprehend. To put the figure into perspective, the $300 trillion accidental mint is nearly 14 times larger than the entire broad money supply (M2) circulating in the U.S. economy, which currently stands at approximately $21.9 trillion. Fortunately, Paxos confirmed that the excess PYUSD was "immediately" identified and subsequently burned, effectively removing the tokens from existence. The firm also stressed in its official statement that the incident was purely an internal mishap and that "there was actually no security breach involved." This rapid identification and destruction of the tokens prevented any market disruption that could have been caused by the sudden appearance of a theoretical $300 trillion asset.
Paxos Joins List of Crypto Minting Errors
While Paxos's error is unprecedented in size, it is not the first time a major entity in the cryptocurrency space has experienced a monumental minting blunder. The incident joins a history of accidental token creations, illustrating the technical complexities of operating large-scale blockchain networks. Previous high-profile errors include:
- Binance: Mistakenly minted a total of $14.5 billion worth of Binance Ethereum (BETH) in 2023, followed by another accidental creation of $500 million worth of the token. Both excess amounts were swiftly destroyed.
- Bitcoin Network: In 2010, an "overflow bug" vulnerability in the code led to the creation of 92 billion BTC within a single transaction, necessitating a hard fork to correct the error.
- Tether: In 2019, the stablecoin issuer accidentally minted $5 billion USDT instead of the intended $50 million.
The quick resolution by Paxos reaffirms the importance of robust internal monitoring and the capacity to swiftly undo errors in the complex world of token minting.