PayPal faces SEC action related to PYUSD stablecoin: Official

Payment giant PayPal has actually gotten a subpoena from the United States Securities and Exchange Commission (SEC) concerning its U.S. dollar-pegged stablecoin.The Enforcement division of the SEC has sent out a subpoena to PayPal associated to its PayPal USD (PYUSD) stablecoin, the company officially disclosed on Nov. 2 in its Q3 financial report with the SEC.Received by PayPal on Nov. 1, the subpoena asked for PayPal to produce particular documents, the company said. “We are cooperating with the SEC regarding this demand,” PayPal noted.The action happens three months after PayPal introduced its PYUSD stablecoin in early August. The stablecoin is issued by Paxos Trust and backed by U.S. dollar deposits, short-term Treasurys and comparable cash equivalents. PYUSD is based upon the Ethereum blockchain and is focused on dealing with digital payments and Web3.According to a spokesperson for Paxos, PYUSD has seen a successful rollout so far, reaching a $150 million market capitalization in the two months considering that its launch. At the time of writing, the marketplace cap of PYUSD is valued at about $159 million, with practically $2.7 million in daily trading volume, according to data from CoinGecko.PayPal USD (PYUSD) stablecoin information. Source: CoinGeckoPayPal did not immediately react to Cointelegraphs request for comment.The sharp increase in the adoption of PayPal USD came amid major exchanges like Coinbase, Crypto.com, Bitstamp and Kraken listing the stablecoin on their platforms right after its launch. In September, PayPal revealed the upcoming combination of the PYUSD stablecoin into the Venmo mobile payment service, permitting users to acquire PYUSD and send it to good friends and family.Apart from aggressively moving into crypto in the United States, PayPal has actually likewise been advancing with crypto efforts in other nations. On Oct. 31, PayPal received a license from the United Kingdom Financial Conduct Authority to use crypto services in the country.Related: Gary Gensler teases details of SECs $5B take from enforcement actions, shades cryptoThe latest SEC action versus PayPal is more evidence that the U.S. is a challenging environment for crypto business. The regulator has actually taken legal action against numerous of the largest local business in the crypto industry, including its ongoing claim versus Coinbase exchange. In October 2023, the SEC finally moved to dismiss its three-year claim versus Ripple, the business behind the XRP (XRP) token, among the largest cryptocurrencies by market cap.In April 2023, Circle CEO Jeremy Allaire argued that a cryptocurrency crackdown by U.S. regulators had been a significant factor behind the decreasing market capitalization of Circles USD Coin (USDC) stablecoin.Magazine: Crypto policy– Does SEC Chair Gary Gensler have the final say?