PayPal Receives SEC Subpoena Focused on Stablecoin Work

PayPal received a subpoena from the US Securities and Exchange Commission's division of enforcement related to its work on a dollar-linked stablecoin. From a report: The subpoena asked PayPal to produce documents tied to the project, according to a regulatory filing on Thursday. The company is cooperating with the probe, the filing said. PayPal unveiled the stablecoin, known as PayPal USD (PYUSD), in August. The coin is pegged to the dollar and fully backed by US dollar deposits, short-term Treasuries and similar cash equivalents, the San Jose, California-based payments company said at the time. The coin has a market capitalization of about $158 million, according to CoinGecko data. For years, US regulators have been scrutinizing stablecoins. Their concerns are twofold: They worry that if a stablecoin crashes, it could trigger fire sales of other assets as their backers try to maintain a peg. They also fear that if stablecoins prove their worth, they could undermine the power of central banks and more easily enable criminals to engage in money laundering.

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