Paxos, the regulated blockchain infrastructure platform, has disclosed the “specific” financial instruments backing its “regulated” stablecoins USDP and BUSD.
Moving forward, Paxos will “provide these detailed disclosures on a monthly basis in addition to its attestations.”
These reports “provide the CUSIP of all instruments backing USDP and BUSD, showing that Paxos only backs its stablecoins with cash, overnight loans secured only by US Treasuries, and US Treasuries with a less than 90-day maturity.”
The monthly reserve reports “are available on the Paxos website.”
As a Trust Company chartered by the New York State Department of Financial Services (NYDFS), Paxos is legally required “to hold all regulated stablecoin reserves in bankruptcy remote, fully-segregated accounts and in only cash & cash equivalents.”
Paxos-issued stablecoins “have and always will be fully backed by a dollar,” the company claims. This design “ensures that stablecoin holders will always be able to access their funds and redeem their stablecoins, as assets are not co-mingled with Paxos corporate funds.”
Additionally, Paxos cannot change its reserve composition “without explicit approval from the NYDFS.” The new monthly reserve reports “underscore Paxos’ commitment to transparency, trust and full dollar backing.” No other stablecoin issuer “provides this level of detail and full US dollar backing.” according to the company.
Charles Cascarilla, Paxos CEO and Co-Founder, commented:
“The only way we can build trust in stablecoins and grow the adoption of this important technology globally is by continuing to embrace robust oversight and providing unprecedented transparency. Our stablecoins are a dollar backed by cash and equivalents and these enhanced disclosures underscore this point. Paxos has always offered the safest US dollar-backed stablecoins.”
The recent volatility of crypto markets “demonstrates the importance of full 1:1 dollar backing for stablecoins plus oversight by a primary prudential regulator.”
While many firms claim to offer stability and safety, “without regulatory oversight from a primary prudential regulator, consumers cannot be assured that their funds and assets are safe, fully segregated and bankruptcy remote.”
The NYDFS recently issued stablecoin guidance that “provides a foundational framework for the structure and issuance of stablecoins.” Notably, Paxos stablecoins “meet this regulatory guidance.”
As covered, Paxos claims to be “the leading regulated blockchain infrastructure platform. Its products are the foundation for a new, open financial system that can operate faster and more efficiently.”
Today, trillions of dollars are “locked in inefficient, outdated financial plumbing that is inaccessible to millions of people.”
Paxos is “re-platforming the financial system to enable assets to instantaneously move anywhere in the world, at any time, in a trustworthy way.”
Paxos uses technology “to tokenize, custody, trade and settle assets.”
It builds enterprise blockchain solutions “for institutions like PayPal, Interactive Brokers, Mastercard, MercadoLibre, Nubank, Bank of America, Credit Suisse and Societe Generale.”
Paxos claims that it is “a top-funded fintech company with more than $540 million raised from leading investors including Oak HC/FT, Declaration Partners, Founders Fund, Mithril Capital and PayPal Ventures.” With offices in New York, London and Singapore, Paxos takes “a global approach to modernizing the financial system.”
