Paxos Launches Dollar-Backed Stablecoin Paxos Standard (PAX)
Blockchain Trust Company Paxos has announced on Monday, September 10, 2018, that it has launched its stablecoin called PAX following the approval from New York regulators.
Blockchain Trust Company Paxos has announced on Monday, September 10, 2018, that it has launched its stablecoin following approval from New York regulators.
The stablecoin dubbed Paxos Standard (PAX) will be pegged 1:1 against the U.S Dollar, with the regulators set to oversee the issuing and trading of the cryptocurrency.
PAX to be fully regulated
In its statement, the company stated that the stablecoin can be bought or redeemed by their customers on a 1:1 basis with the greenback.
It assured the cryptocurrency community that each PAX token is fully backed by dollars held at US-based FDIC-insured banks.
The approval was granted by the New York Department of Financial Services (NYDFS) and the token successfully launched on the Ethereum network.
The regulators revealed that Paxos agreed to abide by Know Your Customer regulations to ensure that they don’t support money laundering, and fraud while also protecting consumers.
In addition to that, the firm will be subject to charter revocation if they fall short of complying with the provisions given to them by the regulators.
The firm is excited that it is the first regulated financial institution to issue a crypto asset that has gotten approval from a regulator. This latest development will allow them to bring more trust and protection to the cryptocurrency world.
Crypto availability is one of their goals
In its blog post, Paxos noted that it isn’t just after cryptocurrency adoption. Even though that is a good thing, they believe that cryptocurrency availability is crucial to the growth of the industry.
They want to ensure that mobilizing cryptocurrencies anywhere and anytime is very important. With the help of blockchain and decentralization, Paxos believes that settlement risks can be mitigated more efficiently.
The firm also strives to educate users on the benefits of the PAX stablecoin. One such way is through their exchange itBit and other exchanges where the stablecoin will be available to traders.
Traders can move their cryptocurrencies to PAX to ensure that volatility doesn’t affect their funds.
Secondly, users can also access the stablecoin via their trading desks. PAX can be used to settle the cash side of any crypto trades instantly, any day of the week. The firm warned, however, that at the moment, PAX is best traded against other cryptocurrencies.
In the future, Paxos is optimistic that the stablecoin will be used in settling transactions with any assets, not just cryptocurrencies. They are also hopeful that it would be used in commerce, thus fulfilling the dream of Bitcoin.
PAX promises fast transaction times, and their transaction fees will be amongst the lowest since they will the ones offering the coins.
Gemini Trusts gets a similar approval
Paxos wasn’t the only company to receive this approval from the NYDFS. The regulatory body also granted the Winklevoss Gemini trust the license to launch a stablecoin, the Gemini dollar (GUSD).
Similar to the PAX, the GUSD is also running on the Ethereum network and is pegged 1:1 against the U.S Dollars.