Paxos Trust Company, the issuing entity behind famous stablecoins PayPal USD (PYUSD), Pax Dollar (PUSD), Pax Gold (PAXG), and the now defunct Binance USD (BUSD), has introduced its new stablecoin – the USD Lift (USDL). The stablecoin will be distributed by Paxos’ UAE-based affiliate, Paxos International.
USDL is a yield-generating stablecoin that allows users to accrue interest as they hold the asset, thus working as a “savings product than a checking account product,” said Charles Cascarilla, CEO of Paxos. The stablecoin and the yield-generating mechanism have received approval in the Abu Dhabi Global Markets (ADGM) free zone by the Financial Services Regulatory Authority (FSRA).
The stablecoin will also be offered in other regions, with a specialized focus on Argentina, thanks to the country’s liking towards crypto and USD-backed stablecoins due to their national currency exhibiting severe volatility. Argentinian users can interact with the asset through various platforms, including TiendaCrypto, Ripio, and Buenbit. It will not be available to US users due to the lack of regulatory clarity in the country.
Ronak Daya, Head of Product at Paxos, said, “Our targeted launch in Argentina will ensure millions of token holders will now have safe access to US dollars, enabling them not only to save and transact, but also earn daily yield. We are pleased to work with these trusted platforms and look forward to growing our partnerships throughout the year.”
Paxos, like other trusted stablecoin issuers, backs their stablecoins with 1:1 reserves of cash and cash equivalent assets like treasury bills. These stablecoin companies register billions in gains through the interest earned by holding the assets. Paxos will channel a portion of its profits to USDL users as yield. Cascarilla stated, “[USDL] is going one step further from democratizing access to dollars, to also democratizing the risk-free rate, in the safest manner possible.”
USDL will be deployed on Ethereum, allowing users to earn yields via the network’s smart contracts daily. Paxos’ USDL aims to further blockchain-based reward generation in low-risk manners while leveraging the openness of blockchain to allow anyone to utilize this product.
Image by Steve Buissinne from Pixabay
