Paxos Announces USD-Pegged Stablecoin USDG Issued in Singapore and Custodied with DBS Bank
Key Takeaways:
- Paxos has introduced a new dollar stablecoin, this time issued by its Singaporean arm.
- Paxos states that the USDG stablecoin combines regulatory compliance with real economic value for enterprises.
- USDG is another dollar-pegged stablecoin joining USDP, PYUSD, USDL, and PAXG, all stablecoins issued by Paxos.
Blockchain and tokenization infrastructure company Paxos is expanding its offerings by introducing a dollar-pegged stablecoin. Paxos has now announced it launched a new Global Dollar (USDG) stablecoin backed 1:1 to the dollar by reserves maintained through US dollar deposits, government securities, and other cash-equivalent assets.
In an official announcement, Paxos stated that USDG will be issued by Paxos Digital Singapore Pte. Ltd. and distributed through wholesale and retail channels via Paxos Global Pte. Ltd.
Paxos is gradually strengthening its presence in the crypto stablecoin market, adding USDG to a list that already includes Pax Gold (PAXG), Pax Dollar (USDP), and PayPal USD (PYUSD). In addition, Paxos is contributing to stablecoins in a market worth $176.7 billion and is used for several functions across different services, including entertainment activities, such as crypto casinos where gamblers can play Sic Bo online. An old Chinese game that has gained worldwide popularity in several major online gaming platforms, Sic Bo is played with three dice on a special table, where players can bet on various outcomes like the dice sum or possible combinations. The application of stablecoins to online gaming makes playing Sic bo easy, as deposits and withdrawals are instantaneous, delivering a smooth gambling experience.
DBS Bank Handling Cash Management and Custody
Highlighting the problem USDG solves, Paxos Head of Product, Ronak Daya, said:
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.
According to the release, Southeast Asias largest bank by assets, DBS Bank, will be responsible for custody and cash management of USDG reserves. Daya adds that USDG will contribute to the global adoption of stablecoins through its partnership with DBS. He believes that this will particularly benefit enterprise clients on a global scale.
USDG is the first digital asset issued by Paxos Digital Singapore. On the other hand, Paxos Trust Company, LLC, which is under the purview of the New York Department of Financial Services (NYDFS), issues the USDP, PYUSD, and PAXG stablecoins. In addition, the UAE-domiciled affiliate, Paxos International, issues Lift Dollar (USDL), a yield-bearing stablecoin.
Paxos Relationship With Regulators
Paxos specified that USDG is compliant with an upcoming stablecoin framework from the Monetary Authority of Singapore (MAS). In August last year, MAS announced features of a new regulatory framework that covers stablecoins in Singapore. According to an official MAS media release, any stablecoin issued in Singapore and pegged to a G10 currency must fulfill several key standards. These include requirements that promote stability of the assets value, minimum base capital to reduce insolvency risks, appropriate disclosures, and redemption at par after a maximum of five business days following a redemption request.
MAS Deputy Managing Director (Financial Supervision), Ms Ho Hern Shin, said the framework is necessary to advance the use of stablecoins as a trusted bridge between the fiat and crypto ecosystems, and as a credible medium of exchange.
In July, Paxos announced that the United States Securities and Exchange Commission (SEC) had stopped its investigation into Binance USD (BUSD), a Binance-branded stablecoin the company also issued. According to Paxos, the SEC sent an official letter stating that there is no recommendation for enforcement action on the BUSD case.
The case began in February 2023 when the Commission sent Paxos a Wells notice alleging that BUSD was an investment contract. Paxos maintains its USD-pegged stablecoins do not qualify as securities under federal law, and believes that the Wells Notice was unnecessary.
Text source: TronWeekly
