Blockchain infrastructure company Paxos, along side Singaporean bank DBS, has introduced a recent stablecoin often known as Global Dollar (USDG). This development comes 4 months after Paxos secured approval to supply digital payment token services as a Major Payments Institution (MPI).
Paxos USDG Compliant With Upcoming Singaporean Regime
In a press release on November 1, Paxos announced the brand new stablecoin USDG set to be issued by its subsidiary in Singapore under the supervision of the Monetary Authority of Singapore (MAS).
Paxos describes USDG as a dollar-pegged stablecoin created to appeal to regulated institutions under strict standards of accountability and security. The stablecoin will probably be issued on Ethereum with impending expansions to other blockchains.
Particularly, USDG is designed to comply with the upcoming Singaporean Stablecoin Regulatory Framework announced back in August 2023. Consistent with the regulations set by MAS, USDG is predicted to take care of certain standards regarding value stability, capital requirements, redemption, and disclosure.
These regulations include holding only low-risk, highly liquid assets in reserve, maintaining a base capital of $1 million, and timely redemption of not more than five days amongst other rules to make sure the security and credibility of all MAS-regulated stablecoins.
Commenting on USDG’s launch, Ronak Daya, Head of Product at Paxos has stressed the potential of the brand new stablecoin to introduce a recent perspective to the market by way of institutional engagement.
Daya says:
Enterprise interest in stablecoins has never been higher than it’s today, however the market lacks an answer that mixes regulatory compliance with real economic incentives for enterprises.
With the launch of USDG, Paxos adds to its list of operational stablecoins resembling PayPal USD (PYUSD), Pax Dollar (USDP), and Pax Gold (PAXG). The blockchain company also served because the issuer of Binance stablecoin BUSD, prior to a stop order from the Latest York Department of Financial Services (NYDFS).
DBS Bank To Manage USDG Reserve
As earlier stated, DBS Bank, the most important bank in Singapore by assets is serving as Paxos’s partner on the USDG stablecoin project. Particularly, DBS is predicted to operate because the custodian of USDG reserves and the key banking partner for money management.
With this arrangement, the DBS bank continues to widen its influence within the digital space amidst growing global interest within the nascent industry. Along with USDG, DBS also operates the DBS Digital Exchange, a crypto-trading platform, and is a significant partner of the Sandbox metaverse project.
Featured image from Bazaarvoice, chart from Tradingview