PAX Gold
Crypto Overview
Understanding the Intended Utility
PAX Gold (PAXG) is a digital token backed by physical gold, where each token represents one fine troy ounce of London Good Delivery gold stored in Brink's vaults. The token was created by Paxos, a regulated financial institution, with the purpose of providing a way to own and trade gold in a digital form with the convenience and security of blockchain technology.
Business Model Evaluation
The business model is straightforward and transparent: Paxos maintains custody of physical gold and issues corresponding digital tokens. Each PAXG token can be redeemed for physical gold, and the gold reserves are regularly audited by third parties. The gold backing is verifiable through chain of custody documentation.
Actual Utility Assessment
PAXG demonstrates significant real-world adoption, primarily used as a digital representation of gold ownership. The token maintains consistent trading volume across major cryptocurrency exchanges and has partnerships with various institutional players. On-chain data shows active trading and holding patterns consistent with its intended use as a gold-backed asset.
Platform Development and Governance
Paxos maintains the platform with regular updates and compliance measures. The project operates under regulatory oversight from the New York State Department of Financial Services (NYDFS), providing additional legitimacy and transparency.
Token Distribution and Founder Assessment
PAXG's supply is directly tied to physical gold reserves - new tokens are only minted when corresponding gold is deposited, and tokens are burned when gold is redeemed. This model prevents founder enrichment through token manipulation. The revenue model is based on transparent fees for token issuance, redemption, and trading.
Crypto Impact
To assign a comfort level investing in PAX Gold from a halal perspective we need to determine whether it has a net positive or negative impact.
Towards this end, the table below is used to tally all the positive and negative considerations our members can think of related to PAX Gold.
If you don’t see something that should be listed, positive or negative, feel free to submit your own contribution using the button “Contribute”.
We will review your contribution for accuracy before publication.
Importantly, you can review listed contributions and vote on which one you think has the greatest impact, positive or negative.
You only have one vote per asset so use it wisely.
You can change your vote if you change your mind.