Paxos has announced its expansion in the stablecoin landscape with the introduction of its Global Dollar (USDG), a new stablecoin that meets the regulatory requirements of Singapore's Monetary Authority (MAS).
This initiative comes just five months after the launch of the Lift Dollar (USDL), which is regulated in the United Arab Emirates.
USDG represents Paxos’ commitment to compliance and security in the rapidly evolving digital currency space.
The USDG stablecoin is backed 1:1 by the US dollar, with its reserves expertly managed by DBS Bank, the largest bank in Southeast Asia.
Paxos Digital Singapore, the entity responsible for USDG, received approval from MAS in July 2024, indicating a robust commitment to regulatory adherence.
Evy Theunis, head of digital assets at DBS Bank, highlighted the importance of this partnership by stating,
“Stablecoin issuers will find that our solutions will help them meet the robust standards regulators and customers expect from them.”
This collaboration not only enhances the credibility of USDG but also positions it favourably within the competitive stablecoin market.
Paxos has ambitious plans for USDG, intending to distribute the stablecoin globally through strategic partnerships with various crypto exchanges, wallets, and trading platforms.
The company envisions USDG playing a vital role in the next phase of stablecoin adoption, catering to both crypto-native users and regulated institutions.
The firm emphasises the need for stability and security in a volatile market, and Ronak Daya, head of product at Paxos, affirmed this, saying,
“Enterprise interest in stablecoins has never been higher than it is today, but the market lacks a solution that combines regulatory compliance with real economic incentives for enterprises.”
USDG has been specifically designed to comply with MAS’ stablecoin framework established in August 2023, ensuring that it operates within the confines of legal regulations.
By initially launching on the Ethereum blockchain, Paxos aims to expand USDG to additional blockchains as regulatory environments continue to develop.
This adaptability is crucial as it positions USDG as a forward-thinking solution in a market where regulatory clarity is paramount.
According to Paxos’ statement on X (formerly Twitter),
“USDG is built to power the next wave of global stablecoin adoption, catering to both crypto-native ecosystems and regulated institutions that maintain higher standards of operation. USDG is available today on Ethereum and will be issued on more blockchains as approved by MAS.”
The company aims to collaborate with global crypto exchanges, wallets, and trading platforms to ensure USDG is accessible to both individuals and institutions.
The backing of USDG includes only high-quality liquid assets such as US dollar deposits, short-duration US government securities, and other cash equivalents.
This rigorous approach ensures that holders can redeem their tokens for fiat currency at any time, maintaining a strict 1:1 parity with the US dollar.
Paxos has showcased its commitment to transparency and reliability, bolstered by its collaboration with DBS Bank, which is responsible for managing the reserves.
Founded in 2012 by Charles Cascarilla and Rich Teo, Paxos is a leading regulated blockchain infrastructure and tokenization platform that has raised nearly $540 million in funding from prominent investors, including Oak HC/FT, Declaration Partners, and Mithril Capital.
The company focuses on modernising financial systems by enabling the instant, trustworthy movement of assets globally and partners with major enterprises like PayPal and Mastercard to tokenize and trade assets.
Paxos is regulated by authorities in the US, Singapore, and Abu Dhabi, and is known for issuing various regulated digital assets, including PayPal USD and Pax Dollar.
Currently, the stablecoin market is heavily influenced by established players like Tether and Circle.
However, recent regulatory developments are encouraging new entrants, including prominent financial services firms like Robinhood and Revolut, who are reportedly exploring their own stablecoin offerings.
This shift indicates a growing recognition of the potential that stablecoins hold in facilitating real-world transactions.
The increasing regulatory clarity is prompting traditional financial institutions to join the space, with companies like Sygnum Bank observing that “stablecoin providers who are already adhering to the developing regulatory standards are likely to gain the advantage as stablecoin use in real-world transactions grows.”
According to a report by Coingecko, PolitiFi, a currency inspired by political events, has outperformed MemeCoin since the beginning of the year, but as the US election approaches, speculative enthusiasm for such currencies has weakened and they may face a downward trend in the future.
JinseFinanceWhy secondary markets, stablecoins, and prediction market platforms are interesting and why there is a lot of innovation happening in this space right now.
JinseFinanceBinance released a research report for the first half of 2024, which not only summarized the industry development in the past six months, but also made predictions for the cryptocurrency market in the second half of the year.
JinseFinanceUnderstanding the practices adopted in Web3 and appropriately tailoring these elements to your project needs is critical to project success.
JinseFinanceHow big of an impact will Mt.Gox’s compensation distribution have on the market?
JinseFinanceAlthough US ETF products have brought an astonishing amount of capital inflows to the market, the market's spontaneous spot self-holding transactions seem to be suppressing buyer pressure, which means that the current market needs more non-arbitrage demand to further stimulate prices.
JinseFinanceThe average MC/FDV of tokens issued in 2024 is 12.3%. In the future, a large number of tokens will enter circulation and face a sell-off.
JinseFinanceUSDT supply surge correlates with Bitcoin's rise, suggesting influence on market trends. Caution urged due to reliance on stablecoin dynamics.
Xu LinIt cited regulatory concerns as the reason behind the move.
OthersA lower supply of a digital asset in circulation means that fewer of it is available to the general public.
Finbold