PayPal PYUSD Stablecoin is 100% backed
Paxos has released its first transparency report for PayPal USD, confirming that the Ethereum-based stablecoin is fully backed by assets.
The report shows that PayPal USD’s total assets exceed the token balance, with total tokens outstanding at $44.4 million as of August 31, 2023. The total notional position value is also $44.5 million. The majority of PYUSD assets are backed by U.S. Treasury reverse repurchase agreements held by Paxos, with nearly 97% of total assets in PYUSD custody in these agreements.
Paxos, a financial services company, has announced that its repurchase agreements are overnight maturity with reputable financial institutions and overcollateralized with U.S. Treasuries. In case of default, Paxos can liquidate U.S. Treasury collateral to make itself whole, and as all trades are overcollateralized, the risk of loss is not considered material.
Paxos reported holding $1,500,146 of fiat currency at insured depository institutions as of August 31, following the launch of PYUSD on August 7. By late August, 90% of PayPal USD was held in Paxos’ wallets, while about 7% was distributed among exchanges like Kraken, Gate.io, and Crypto.com. Paxos provided a link to the IntraFi network or a list of insured depository institutions.
(With inputs from Shikha Singh)
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