According to Foresight News, Paxos has released its first transparency report for PYUSD, disclosing unaudited data as of August 31. The report reveals that the total tokens outstanding amount to approximately $44.37 million, with the current market value of collateral in U.S. Treasury repurchase agreements at $43.86 million and a notional position value of $43 million. The current market value of collateral held in other cash deposits at custodian institutions is around $1.5 million, while the current market value of collateral in total net assets is $45.36 million, with a notional position value of $44.5 million.
Paxos explains that U.S. Treasury repurchase agreements are contractual arrangements between two parties, where one party agrees to sell securities to the other at a specified price and commits to repurchase the securities later at another (usually higher) specified price. If the counterparty defaults, Paxos can liquidate the U.S. Treasury collateral to cover losses. Since all transactions are over-collateralized, the risk of loss is not considered significant.