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Robinhood and Paxos launch global stablecoin network

Robinhood and Paxos launch global stablecoin network

GrafaGrafa2024/11/05 14:00
By:Liezl Gambe

Traditional finance and cryptocurrency firms, including Robinhood, Galaxy Digital, Kraken, and Paxos, have joined forces to create the Global Dollar Network.

Announced by Paxos on Nov. 5, this initiative aims to accelerate stablecoin adoption worldwide, with a focus on their recently launched USDG stablecoin, pegged 1:1 to the US dollar.

"The lack of competition in the regulated stablecoin market has prevented the industry from reaching its full potential. USDG upends this dynamic with a more equitable model that will bring mainstream participants into the ecosystem and accelerate new stablecoin use cases," stated Kraken co-CEO Arjun Sethi.

USDG, initially launched on the Ethereum (CRYPTO:ETH) blockchain, is expected to expand to other chains as regulatory frameworks evolve.

USDG will be issued out of Singapore, aligning with the Monetary Authority of Singapore’s new stablecoin framework.

Singapore’s DBS Bank will manage the stablecoin’s backing, which includes dollar deposits, short-duration U.S. government securities, and other cash equivalents.

This structure ensures that USDG is fully redeemable for fiat currency.

The network will operate by invitation, with access for qualifying custodians, exchanges, and fintech firms.

The goal is to make USDG widely accessible, facilitating stablecoin use across various sectors and enabling enterprise adoption.

Paxos’ head of product, Ronak Daya, emphasised that the partnership with DBS Bank supports enterprise-level stablecoin growth.

The Global Dollar Network enters a stablecoin market currently led by Tether (CRYPTO:USDT) and Circle’s USD Coin (CRYPTO:USDC), which hold dominant shares of 56% and 27%, respectively, on the Ethereum network.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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