Stablecoin firm Paxos has issued a new dollar-pegged token with support from several popular crypto firms.
Paxos announced the launch of a new US dollar-backed stablecoin, the Global Dollar (USDG), in November alongside the introduction of a broader initiative involving major companies in the blockchain sector.
The company called USDG a “new, secure and reliable stablecoin.” It emphasized its intended goals of promoting the adoption of stablecoins globally and meeting the needs of regulated institutions with high operational standards.
Paxos said USDG is immediately available on Ethereum. The company plans to issue USDG on other blockchains in the near future.
USDG is backed by US dollar deposits and high-quality liquid assets to maintain price parity with the dollar and ensure fiat redemptions are possible at all times.
DBS Bank, Southeast Asia’s largest bank by assets, will act as Paxos’ primary banking partner to provide cash management and custody of USDG reserves.
Paxos Digital Singapore, regulated by the Monetary Authority of Singapore (MAS), is the issuer of USDG. An affiliate, Paxos Global, will partner with other services to distribute the USDG stablecoin to individuals and institutions.
In November 4Paxos introduced the Global Dollar Network, a group that will work to incentivize crypto and financial solutions using the USDG stablecoin.
Paxos said the new network is “revolutionizing” the market by offering a stablecoin with “economic benefits provided to all partners.” He noted that existing stablecoins have failed to meet institutional needs, especially needs around regulations and consumer protection. He also noted that traditional enterprise adoption can impose high costs on blockchains and the broader economy.
Initial members include crypto exchanges Bullish and Kraken, institutional crypto bank Anchorage Digital, digital asset company Galaxy Digital, payment processor Nuvei, trading platform Robinhood, and Paxos itself. Other members are expected to join the group, which is currently in an invite-only phase.
Four members (Anchorage Digital, Galaxy Digital, Kraken, and Paxos) will provide users with immediate access to USDG. The others plan to add USDG soon.
As of November 7, the stablecoin market was worth $180 billion, representing a significant portion of the $2.7 trillion cryptocurrency market.
Tether’s USDT and Circle’s USDC stablecoins lead the stablecoin market, with market capitalizations of $122 billion and $37 billion, respectively.
USDG has a minor market capitalization of $10.7 million. Paxos is also responsible for several other stablecoins, including $537 million PayPal USD (PYUSD), $110 million Pax Dollar (USDP), and $538 million Pax Gold (PAXG).
Other companies are moving forward with their stablecoin plans. Ripple is testing its Ripple USD, and cryptocurrency custodian BitGo has announced plans for its USD Standard stablecoin. Revolut is also rumored to be exploring the area.
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