news.bitcoin.com
The blockchain and tokenization infrastructure platform Paxos has announced Paxos International has launched a new yield-bearing stablecoin called lift dollar (USDL). The stablecoin’s holders will earn overnight yield from short-term U.S. government securities and cash equivalent reserve assets with each USDL backed 1:1 in U.S. dollar value.
New ‘Lift Dollar’ Stablecoin Offers Daily Returns on U.S. Government Securities
Paxos International, the UAE-based branch of Paxos, has introduced lift dollar (USDL), a new stablecoin promising to provide daily yields to its holders under strict regulatory supervision. Issued by the Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market, USDL aims to offer a unique approach to earning on stablecoins.
In a move away from traditional centralized financial models, USDL plans to provide access to overnight yields through Ethereum-based smart contracts, which distribute earnings directly to holders. The coin, backed by U.S. government securities and cash equivalents, ensures a stable 1:1 parity with the U.S. dollar. Paxos believes the model contrasts sharply with the high-risk and opaque practices that have characterized much of the digital currency landscape, often leading to firm failures and investor losses.
“USDL is a first-of-its-kind—a regulated product, earning and paying safe yield on a daily basis,” Charles Cascarilla, a member of the Board of Directors of Paxos International stated. “Until now, only centralized issuers have benefitted from the economics of stablecoin reserves. Paxos International has reimagined this dynamic so that all token holders can safely use and grow their regulated USD stablecoin holdings.”
The introduction of USDL follows a period of instability in the stablecoin market in 2022 triggered by the collapse of Terra’s algorithmic stablecoin UST and its associated platform, Anchor. In the aftermath, the stablecoin sector has shown resilience, and a newcomer, USDE from Ethena, has risen to prominence. Launched in February, USDE now boasts a market valuation of $3.17 billion, making it the fourth-largest stablecoin.
USDL is set to debut in Argentina on select cryptocurrency platforms such as Tiendacrypto, Ripio, and Buenbit. However, it will not be accessible to residents of the continental United States or other regions including Japan, Hong Kong, the European Union, the United Kingdom, Singapore, and the UAE, with the exception of the Abu Dhabi Global Market.
What do you think about Paxos International’s yield bearing stablecoin? Share your thoughts and opinions about this subject in the comments section below.