Why is the term liquidating dividend used to describe cash dividends debited against paid-in capital accounts?

Question:

Why is the term liquidating used to describe cash dividends debited against paid-in capital accounts?

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...