PAXOS issues new yield high, legal stable coins in accordance with the law

• paxos has published a new stablecoin, the global dollar (USDG), which legally corresponds to the currency laws Singapore.
• In contrast to other legal stable coins, USDG will distribute a large part of interest income from reserves to market participants that help with the spread of the StableCoin network.
• Big names such as Anchorage Digital, Galaxy Digital, Bullish, Nuvei, Kraken, Paxos and Robinhood support USDG.

PAXOS, the former issuer of the Busd Stablecoins, which has no longer existed, has launched a new StableCoin named Global Dollar, which is compliant with the Monetary Authority of Singapore. The stablecoin is said to be a legally compliant alternative to USDT by Tether and USDC from Circle.

The best of both worlds

USDG takes on functions of the two largest existing stable coins, USDT and USDC, such as its pegging structure. Each USDG is covered 1: 1 by high-quality short-term government bonds, mostly US state bonds.

This binding method is the most legal, since the reserves are kept at registered deposit banks and are liquid enough to meet withdrawal applications.

However, USDG goes one step further and integrates return-prone functions that resemble pure on-chain tablecoins such as Ethena, which are ultimately mechanisms to reward market participants who propagate the use of the stable coin.

PAXOS intends to share the profit made from its currency reserves with companies that help to advance USDG. Usually, stable coin emitters such as Tether and Circle keep all proceeds from their currency reserves as profits, a step that has proven to be extremely profitable because Tether reported a profit of $ 2.5 billion for the third quarter of 2024.

Charles Cascarilla, CEO of Paxos, explained in an interview: "This [USDG] should be a community token" and that "everyone can join the global dollar network and collect rewards for activities." We distribute about 97 % of assets. This is a big difference to the way other stable coins have so far been set up and created. ”

Unlike others in the family

USDG is not the only stable coin that Paxos outputs. At the beginning of June 2024, the company issued the Paxos Lift Dollar (USDL) in the United Arab Emirates, which is regulated by the Financial Services Regulatory Authority (FSRA) of the Abu Dhabi Global Market (ADGM).

USDL is a generating stable coin with a programmatic daily return of about 5 % for end users.

In contrast to the mechanism used at USDL, Paxos will share the yields achieved by the currency reserves of USDG with the companies that fulfill various functions that contribute to the growth of the StableCoin network, and not with the end users.

The other StableCoins In the Paxos offer, PayPal USD (PYUSD), Pax Dollar (USDP) and Pax Gold (Paxg). USDG is available in the United States.