By A NYC based startup by the name of Paxos recently announced that they will be launching a stablecoin which has secured the regulatory backing from the state of New York.
The recently minted Paxos Standard, was approved and will be regulated by the New York Department of Financial Services and is fully backed the US dollar said Paxos. Paxos is also already a qualified custodian, which basically means it is legally regulated and approved by the US Securities as well as the Exchange Commision to hold client funds.
This Paxos Standard token was designed to provide liquidity for potential investors who trade in crypto assets by providing a “digital alternative to cash” which can in addition also see instant transaction settlements according to Paxos.
Co-founder and CEO of Paxos Charles Cascarilla recently said in a statement that this new stablecoin’s objective is to provide various financial markets with the means to carry out transactions by way of “a fully USD-collateralized asset” which utilizes blockchain technology.
Cascarilla went on to call the new token “a significant advancement in digital assets”.
“In the current marketplace, the biggest hindrances to digital asset adoption is trust and volatility. As a regulated trust with a 1:1 dollar-collateralized stablecoin, we believe we are offering an asset that improves on the utility of money.”
Additionally, the stablecoin is built on the standards of the Ethereum ERC-20. This means that the coin can be sent to and from any two wallets on the Ethereum network. It must also be noted, however, that only verified Paxos customers are eligible to redeem or purchase tokens on the company’s website. In order for the stablecoin’s value to be maintained, the tokens are eradicated when they are redeemed while any tokens that remain in circulation are backed by dollars held within the firm.
In addition to these services, Paxos will also offer investors the means of cashing out their crypto holdings immediately if they make use of the Paxos iBit exchange or the over-the-counter trading desk.
This stablecoin token will also be listed on other exchanges using the ticker symbol – PAX.
Finally, Paxos has also in the past received regulatory approvals through the New York Department of Financial Services and also operates under a limited purpose trust company charter.
Do you think that the approval of this stablecoin by the New York Department of Financial Services will lead to the appearance of more dollar backed coins? Let us know your thoughts.
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WHAT IS A STABLECOIN:
A stablecoin is any cryptocurrency pegged to a stable asset, such as gold or fiat currencies. Often times stablecoins are linked to a DAO which controls issuance and pricing.
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