Blockchain trust company Paxos has launched the USD-backed stablecoin the same day as Gemini cryptocurrency exchange released its Gemini dollar.
Backed by U.S. dollar at 1:1 ratio and approved by the New York regulator (namely, the New York State Department of Financial Services (NYDFS)) , as Gemini dollar, Paxos Standard (PAX) token is very much similar to its contestant.
Just like the token launched by the Winklevoss twins, PAX is based on ERC20 standard, whereas investors’ dollar deposits will be held “in segregated accounts at multiple FDIC-insured U.S.-domiciled banks”. Moreover, the press release explains:
“When Paxos Standard tokens are in circulation, the corresponding dollars are held in reserve. Upon redemption for dollars, Paxos Standard tokens are immediately destroyed. Tokens are only in circulation when the corresponding dollars are in custody.”
It is noteworthy, that both Paxos and Gemini claim their coins are a “world first” for regulated cryptoassets.
The issuance of stablecoins designed to reconcile the realms of fiat and cryptocurrency is not specific to US-based platforms only. Swiss company Alprockz AG has also announced the launch of ROCKZ – a regulated stablecoin backed by the world’s most stable fiat currency – Swiss franc.