PAX Gold

Overview

PAX Gold (PAXG) is a digital asset backed by physical gold. Each token represents one fine troy ounce of a London Good Delivery gold bar, stored in Brink's vaults. The token is issued by Paxos Trust Company, a regulated financial institution.

Intended Utility

The primary purpose of PAXG is to provide a digital way to own and trade physical gold. Token holders own the underlying physical gold, with each token being redeemable for physical gold. The cryptocurrency aims to combine the benefits of physical gold ownership with the speed and mobility of blockchain technology.

Actual Utility

PAXG is actively used as intended, with real gold backing each token. Paxos maintains a transparent system where users can verify the serial numbers of gold bars backing their tokens. The token has gained adoption among investors seeking gold exposure in a digital format, with regular redemptions and purchases occurring.

Business Model Analysis

The business model is straightforward and transparent: Paxos purchases and stores physical gold, issues corresponding tokens, and charges small fees for token issuance and redemption. All gold bars are regularly audited by Withum, a top accounting firm, and the project maintains regulatory compliance with the New York State Department of Financial Services.

Token Distribution

PAXG's supply is entirely backed by physical gold - tokens are only minted when new gold is purchased and stored. There is no pre-mine or founder allocation, as tokens are created and burned based on actual gold deposits and withdrawals.

Development and Marketing

Paxos focuses primarily on maintaining the infrastructure for token issuance, redemption, and gold custody. Marketing efforts are professional and focused on institutional investors and gold market participants. The emphasis is on security, compliance, and reliable gold backing rather than token price speculation.