The payment company said it is already cooperating with the regulator on this issue.
What happened? The US Securities and Exchange Commission (SEC) enforcement division has ordered PayPal to provide documents regarding its PYUSD stablecoin, the payments company announced in a new financial report. The issuance of a subpoena by the SEC is a means of gathering information and does not necessarily result in the filing of a lawsuit or further proceedings. PayPal assured that they are already cooperating with the department on this issue.
What else is known? PYUSD was launched on August 7 on the Ethereum blockchain; it is an ERC20 token pegged to the US dollar exchange rate. The asset is issued by the US-regulated fintech company Paxos under the PayPal brand, and since September reports on its reserves have been published monthly, authored by an independent auditor.
JPMorgan stated that PYUSD could increase activity on the Ethereum network if it manages to fill the niche of the BUSD stablecoin from the Binance crypto exchange, the issue of which was stopped by a decision of the authorities in February. Paxos was also an issuer of BUSD.
Despite the fact that PYUSD is available on several exchanges, including Bybit, Kraken, Coinbase, Huobi, Gate and Crypto com, the daily trading volume of the asset as of November 2 at 17:40 Moscow time is only $2.4 million.
Almost immediately after the launch, US House of Representatives member Maxine Waters criticized PYUSD. She noted that the country does not yet have a legislative framework to regulate such assets.
Notably, BUSD has also previously attracted the attention of the SEC. The regulator classified the asset as unregistered securities and planned to sue for violating investor protection laws. After this, the New York State Department of Financial Services (NYDFS) ordered the coin to be discontinued.
