Paxos launched the USDG stablecoin in response to institutional demand for a fully regulated stablecoin.
By Chimamanda U. Martha
Edited by Julia Sakovich
Updated
3 mins read
Paxos, a leading blockchain infrastructure provider headquartered in the United States, is expanding its stablecoin offerings with the launch of “Global Dollar” (USDG), designed to redefine standards in the competitive stablecoin market.
According to the announcement, the new stablecoin based on Ethereum is backed 1:1 to the value of the US dollar, with reserves maintained solely in high-quality assets, including US dollar deposits, short-term US government securities, and other cash-equivalent holdings.
The digital asset is designed with institutional-grade reliability, offering a secure, fully backed digital dollar alternative that meets the evolving needs of both retail users and regulated financial institutions.
Paxos said the stablecoin will be exclusively issued by its Singapore subsidiary, Paxos Digital Singapore Pte, and regulated by the country’s Monetary Authority (MAS). The blockchain infrastructure provider said this strategic regulatory compliance is aimed at ensuring USDG meets the MAS’s incoming stablecoin requirements.
The move aims to set the newly launched token apart from other existing stablecoins by prioritizing transparency, liquidity, and institutional-grade backing. According to Paxos, its endgame is to make USDG a stablecoin of choice for regulated institutions and enterprises worldwide.
The company’s head of product, Ronak Daya, said the market is currently in demand for a stablecoin that offers both regulatory compliance and economic advantages for enterprise use.
“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. Keeping with the Paxos tradition of powering infrastructure for the world’s most important and innovative enterprises, we are thrilled to launch the Global Dollar (USDG),” said Daya.
While the stablecoin is currently restricted to the Ethereum blockchain, Paxos plans to expand access to the digital asset to other blockchains soon.
The newly launched stablecoin joins a family of Paxos-issued digital assets, including PayPal USD (PYUSD), Pax Dollar (USDP), and Pax Gold (PAXG), all issued under a framework of strict regulatory oversight. The company has demonstrated its commitment to a regulated approach, with entities in Singapore, the United Arab Emirates (UAE), and the United States overseen by relevant local authorities.
For USDG, Paxos has tapped DBS Bank, Southeast Asia’s largest bank, as its primary partner for cash management and custody of the stablecoin reserves. The bank’s responsibilities include holding the US dollar reserves and supporting USDG to enhance security and trust among investors and ensure the stablecoin remains stable in the face of market uncertainty.
Paxos said that DBS’s established track record, recognized by Global Finance as Asia’s safest for 16 consecutive years, will add a layer of reassurance for users and potential partners.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Chimamanda is a crypto enthusiast and experienced writer focusing on the dynamic world of cryptocurrencies. She joined the industry in 2019 and has since developed an interest in the emerging economy. She combines her passion for blockchain technology with her love for travel and food, bringing a fresh and engaging perspective to her work.
