PayPal has received a subpoena from the Securities and Exchange Commission (SEC) requesting documentation regarding its recently launched stablecoin, PayPal USD (PYUSD).
In its quarterly earnings report, PayPal stated, “On November 1, 2023, we received a subpoena from the U.S. SEC Division of Enforcement relating to PayPal USD stablecoin. The subpoena requests the production of documents. We are cooperating with the SEC in connection with this request.”
The filing does not provide further details about the SEC’s request. PayPal USD was launched in August, aiming to succeed where Facebook’s Libra project faced significant regulatory challenges. The stablecoin is issued by Paxos and is fully backed by US dollar deposits, short-term US Treasuries, and similar cash equivalents.
Customers can use PYUSD to transfer the token to external wallets, conduct peer-to-peer payments, fund purchases at merchants that accept PayPal, and convert cryptocurrency holdings to and from the stablecoin.