- The SEC’s Enforcement division sent a notice regarding PayPal’s PayPal USD stablecoin, which the firm announced on November 2.
- This action comes nearly three months after the launch of PayPal’s PYUSD stablecoin in early August.
- According to a spokesperson for Paxos, PYUSD has been successfully deployed so far and has reached a market cap of $150 million in the two months since its launch.
Payment giant PayPal announced in its statements today that it received a notification from the SEC: PYUSD may be in trouble with the SEC!
PayPal Receives Notice from SEC Regarding PayPal USD
Payment giant PayPal has received a notice regarding its USD-backed stablecoin. The SEC’s Enforcement division has issued a notice concerning PayPal’s PayPal USD stablecoin, and the company disclosed this on November 2nd.
This action comes approximately three months after the launch of PayPal’s PYUSD stablecoin. The stablecoin is issued by Paxos Trust and backed by U.S. dollar deposits, short-term Treasury bonds, and similar cash equivalents. PYUSD is based on the Ethereum blockchain and aims to deal with digital payments and Web3 transactions.
According to a spokesperson for Paxos, PYUSD has been successfully rolled out so far and has reached a market capitalization of $150 million within two months since its launch. As of the time of writing, PYUSD is valued at approximately $159 million according to data, with a daily trading volume of around $2.7 million.
The sharp increase in the acceptance of PayPal USD followed the immediate listing of the stablecoin on major exchanges such as Coinbase, Crypto.com, Bitstamp, and Kraken following its launch. In September, PayPal announced the integration of PYUSD stablecoin into the Venmo mobile payment service, allowing users to purchase PYUSD and send it to friends and family.
PayPal, which has aggressively entered the crypto space in the U.S., is also expanding with crypto ventures in other countries. On October 31st, PayPal obtained a license from the UK Financial Conduct Authority to offer crypto services in the UK.
SEC Maintains a Strict Stance on Crypto
The recent SEC action against PayPal is further evidence of the challenging regulatory environment for crypto companies in the U.S. Regulators have filed lawsuits against some of the largest local crypto industry companies, including an ongoing lawsuit with Coinbase. In 2023, the SEC finally concluded its three-year legal battle against Ripple, the company behind the XRP token, one of the largest cryptocurrencies by market capitalization.
In 2023, Circle CEO Jeremy Allaire claimed that the strict regulatory scrutiny of cryptocurrencies by U.S. regulators was a significant factor in the market value decline of Circle’s USDC stablecoin.
