Paxos Mints and Burns $300T PYUSD in Glitch, Maintains Peg
On Ethereum in October 2025, Paxos accidentally minted 300 trillion PYUSD tokens, equivalent to $300 trillion. Within 22 minutes, automated risk controls on Aave halted PYUSD trading as Paxos burned the excess supply in the largest token burn in crypto history.
Paxos confirmed on X that the glitch was an internal technical error, not a security breach, and assured customers that funds remained safe. Despite the massive nominal volume, PYUSD’s price dipped just 0.5% before returning to its 1:1 dollar peg, and its market cap stayed above $2.3 billion.
The incident highlights blockchain transparency: every operation on the public ledger was instantly visible. Industry experts praised real-time accountability but urged stronger operational controls for stablecoin management.
Neutral
As PYUSD’s price dipped only 0.5% and quickly regained its dollar peg, traders saw no prolonged volatility. The absence of a security breach and swift token burn reinforced confidence in the stablecoin’s stability protocols. Although risk controls triggered a temporary halt on Aave, blockchain transparency ensured instant traceability of the mint and burn. Overall, the event underscores operational resilience rather than triggering significant market shifts, suggesting a neutral impact on PYUSD trading.