Paxos Introduces USDG Stablecoin Compliant With Upcoming Singaporean Regime

Blockchain infrastructure company Paxos, in conjunction with Singaporean bank DBS, has introduced a new stablecoin known as Global Dollar (USDG).

Singaporean bank DBS has teamed up with blockchain infrastructure company Paxos to launch a new stablecoin called Global Dollar (USDG). This development comes four months after Paxos received approval to offer digital payment token services as a Major Payments Institution (MPI).

Paxos USDG to Comply With Upcoming Singaporean Stablecoin Regime

According to a press release on November 1, Paxos, via its Singaporean subsidiary, will issue the new stablecoin under the supervision of the Monetary Authority of Singapore (MAS).

Describing USDG as a dollar-pegged stablecoin designed to cater to regulated institutions with strict standards of accountability and security, Paxos will issue the stablecoin on Ethereum, with plans to expand to other blockchains.

Significantly, USDG is designed to comply with the upcoming Singaporean Stablecoin Regulatory Framework that was announced in August 2023. As part of the regulations set by MAS, USDG will be expected to maintain certain standards regarding value stability, capital requirements, redemption, and disclosure.

These regulations include maintaining a reserve of only low-risk, highly liquid assets, a base capital of $1 million, and timely redemption of not more than five days among other rules to ensure the security and credibility of all MAS-regulated stablecoins.

Commenting on USDG’s launch, Ronak Daya, Head of Product at Paxos highlighted the potential of the new stablecoin to introduce a new perspective to the market in terms of institutional engagement.

“Enterprise interest in stablecoins has never been higher than it is today, but the market lacks a solution that combines regulatory compliance with real economic incentives for enterprises,” Daya said.

With the launch of USDG, Paxos adds to its lineup of operational stablecoins that include PayPal USD (PYUSD), Pax Dollar (USDP), and Pax Gold (PAXG). The blockchain company also served as the issuer of Binance stablecoin BUSD, prior to a cease order from the New York Department of Financial Services (NYDFS).

DBS Bank to Manage USDG Reserve

As mentioned earlier, DBS Bank, Singapore’s largest bank by assets, is partnering with Paxos on the USDG stablecoin project. Notably, DBS will serve as the custodian of USDG reserves and the main banking partner for cash management.

This move by DBS further cements the bank's presence in the digital space as global interest in the nascent industry continues to grow. In addition to USDG, DBS also operates the DBS Digital Exchange, a crypto-trading platform, and is a key partner in the Sandbox metaverse project.