USDP Stablecoin
Crypto Overview
Purpose and Utility
USDP (formerly known as PAX) is a regulated USD-backed stablecoin issued by Paxos Trust Company. Each USDP token is backed 1:1 by US dollars held in FDIC-insured US banks and US Treasury bills. The primary purpose is to provide a stable, regulated digital asset that maintains a 1:1 peg with the US dollar.
Business Model Assessment
Paxos operates under regulatory oversight from the New York State Department of Financial Services (NYDFS). The business model involves maintaining dollar reserves equal to the circulating supply of USDP tokens. Revenue is generated through institutional services and partnerships rather than lending or interest-bearing activities. Monthly attestation reports verify the 1:1 backing.
Real-World Adoption
USDP has achieved significant adoption in institutional markets and cryptocurrency exchanges. It serves as a trading pair on major exchanges and is used for settlement in various blockchain-based payment systems. As of 2023, USDP maintains a market capitalization of over $500 million.
Platform Development
Paxos regularly updates its platform and maintains strong compliance standards. The company continues to expand its institutional partnerships and has developed additional blockchain-based products and services.
Token Distribution and Governance
USDP tokens are minted when USD is deposited and burned when redeemed, maintaining the 1:1 peg. There is no token allocation to founders or team members as this is a fully backed stablecoin.
Crypto Impact
To assign a comfort level investing in USDP Stablecoin 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 USDP Stablecoin.
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.