Unknown scammers have created more than 60 fake PayPal USD tokens on multiple blockchains – imitating a stablecoin issued by the payment system to collect funds from gullible citizens. In reality, these digital assets are worth nothing.
Image source: Muhammad Asyfaul / unsplash.com
Fake tokens have appeared on the BNB Chain, Base, and other blockchains, but most of them are on the Ethereum network, which became PayPal’s real cryptocurrency platform. On the decentralized cryptocurrency exchange Uniswap alone, fake trading volume hit $2.9 million today. The real PayPal USD cryptocurrency was created back in November last year. Only registered users of the payment system can work with it – transfers are only possible within the payment system and to compatible crypto wallets.
Officially, the PayPal stablecoin has not yet appeared on any of the cryptocurrency exchanges, but scammers are already actively using its PYUSD ticker to issue their own tokens. Creating such a fake and placing it on a decentralized crypto exchange is a relatively easy task. This requires basic technical training to create a smart contract on the blockchain and the means to ensure the initial liquidity of the asset. Next, scammers mimic trading activities by scrolling through their own working capital – this encourages gullible users to join the trade, thereby boosting the token’s capitalization. A smart contract can be programmed so that only its creator can place orders for its sale or instantly extract liquidity from the entire pool of fake cryptocurrencies, leaving buyers with a token that is in reality worth nothing.
Previously, PayPal had announced the release of its own stablecoin – this will help the payment service expand its range of services. US users will be the first to have access to a stable cryptocurrency. The asset is issued by Paxos Trust.
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