Blockchain Firm Paxos Obtains License for New Entity in Singapore
Blockchain infrastructure firm Paxos has obtained a preliminary license from the Monetary Authority of Singapore (MAS) for its new entity. With the in-principal approval, Paxos Digital Singapore, the new entity, will offer digital payment token services to Singaporeans.
Paxos Plans to Launch USD-Backed Stablecoin
Paxos announced plans to launch a USD-backed stablecoin. In a Thursday statement, Paxos noted that the new USD stablecoin will be compliant with MAS’ proposed stablecoin regulatory framework. The new regulatory framework seeks to ensure high price stability for stablecoins regulated in Singapore. “Paxos consistently pursues growth in global markets within regulated frameworks and engages with regulators to help inform digital asset rules.”
“Paxos consistently pursues growth in global markets within regulated frameworks and engages with regulators to help inform digital asset rules.”
The company confirmed that it would only issue tokens subject to oversight by prudential regulators. Paxos also maintains strict anti-money laundering (AML) and know-your-customer (KYC) standards in jurisdictions like Singapore. Paxos also said that it will partner with enterprise clients to issue the new stablecoin in Singapore upon full approval.
Walter Hessert, Paxos Head of Strategy, said that customers outside the US face difficulties in getting USD safely and reliably. The company has a 1:1 backing by the US Dollar for all issued tokens, ensuring stability. Paxos hopes that the new venture will attract more clients outside the US as demand for stablecoins is high.
Paxos and MAS Collaboration
The announcement comes a year after Paxos received an operating license from MAS, allowing it to offer tokenization and custody. Paxos already issues the USDP stablecoin, which has a circulating supply of 461.56 million. USDP reserves are held 100% in cash and US treasuries, implying that customer funds are always available for 1:1 redemption.
Additionally, PayPal’s stablecoin – PYUSD, which launched in August, is also from the same company. Previously, Paxos minted the now-defunct Binance’s BUSD stablecoin. Binance ceased stablecoin operations following its regulatory clash with the New York Department of Financial Services (NYDFS).
