PayPal receives SEC subpoena over stablecoin

PayPal, in a 10-Q, disclosed the subpoena, which it received Thursday

article-image

Robert Way/Shutterstock, modified by Blockworks

share

PayPal disclosed that it received a subpoena from the Securities and Exchange Commission’s division of enforcement on Wednesday.

The extent of the subpoena is unclear, though PayPal noted that the regulator is seeking documents, and it is actively cooperating with the subpoena.

“The subpoena requests the production of documents. We are cooperating with the SEC in connection with this request,” PayPal said in a form 10-Q.

PayPal launched its stablecoin back in August, marking the first foray into dollar-backed stablecoins by a traditional finance firm. 

The stablecoin is issued on Ethereum by Paxos Trust Co. A monthly reserve report on the stablecoin is also handled by Paxos, alongside an “attestation of the value of PayPal USD reserve assets.”

While the stablecoin initially received some praise, some in Washington also took a more critical view on the launch.

House Democrat Maxine Waters D-Cali. said she was “deeply concerned” about the new stablecoin in August.

She added that there needs to be “federal guardrails” on any “issuance of a new form of money.”

Chair of the House Financial Services Committee Patrick McHenry R-NC said that PayPal’s announcement was a “clear signal that stablecoins — if issued under a clear regulatory framework — hold promise as a pillar of our 21st-century payments system.”

McHenry’s committee passed the bipartisan Clarity for Payment Stablecoins Act, which “identifies regulatory paths for approving and regulating stablecoin issuers.”

The Democrats and Republicans struggled with the bill in markup, leading to politicians engaging in a shouting match in July.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward Guidance newsletter.

Get alpha directly in your inbox with the 0xResearch newsletter — market highlights, charts, degen trade ideas, governance updates, and more.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Javits Center North | 445 11th Ave

Tues - Thurs, March 18 - 20, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Research Report Templates (6).png

Research

In recent months, a number of highly accretive developments were implemented across the protocol to improve fee capture, expand product functionality, and ultimately drive value accrual to the RUNE token, with more upgrades on the immediate horizon. These developments include hiking the minimum swap fee parameter to increase revenue, adding a Burn System Income Lever to reduce the RUNE supply, the addition of COSM-WASM smart contracting and IBC to enable an application layer, new chain integrations, and more.

article-image

Former IRS agent and Binance executive Tigran Gambaryan will remain imprisoned in Nigeria’s Kuje prison

article-image

When Permissionless III wraps on Friday, there will be 26 days left until the 2024 presidential election

article-image

Plus, an update from the ground in Salt Lake City at Permissionless III

article-image

The US regulator accused the crypto market-making firm of acting as an unregistered dealer

article-image

Customers can pay merchants in USDC or USDP on Ethereum, Solana, and Polygon, while US-based merchants are paid in dollars