SEC Ends 15-Month Probe Into PayPal's PYUSD on Ethereum, No Action Taken

The U.S. Securities and Exchange Commission (SEC) has concluded its 15-month investigation into PayPal's stablecoin, PayPal USD (PYUSD), without taking any enforcement action. The decision was communicated to PayPal in February, as disclosed in a recent regulatory filing.

The investigation, initiated with a subpoena in November 2023 requesting documents related to PYUSD, has now been closed, alleviating a potential regulatory burden for PayPal and its stablecoin issuer, Paxos Trust. PYUSD, launched on Ethereum and backed by short-term Treasuries, dollar deposits, and cash equivalents, has seen a 75% increase in circulating supply since the beginning of 2025, with its current market capitalization standing at approximately $880 million.

This development coincides with legislative efforts to regulate stablecoins, with the STABLE and GENIUS Acts advancing in Congress. These bills aim to establish clear rules for dollar-backed stablecoins, reflecting a broader regulatory shift under the Trump administration's SEC. Additionally, PayPal has partnered with Coinbase to expand PYUSD's reach, offering a 3.7% annual yield to US users holding the asset on the platform.

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