FinTech News
Paxos Discusses Plans for Precious Metal and Stock-Backed Cryptocurrencies
When it comes to the general public, easily the biggest concern about cryptocurrencies is the perception that they amount to “fake money.” In response there have been those that have touted so-called stablecoins that are pegged to fiat currencies. Now, as Fortune reports, Paxos is looking to roll out a token backed by commodities, such as gold, as well as others tied to publicly traded stocks.
Paxos actually already has a stablecoin, which it launched six months ago. Dubbed Paxos Standard — or PAX — the U.S. dollar backed token is currently listed on a number of exchanges, including Binance, Bitpay, and others. Currently CoinMarketCap estimate PAX’s market capitalization at $112,981,150, with each coin valued at $1.01.
As for what coins Paxos is looking to introduce now, the companies CEO Chad Cascarilla told Fortune he wants to take “any type of asset and put it into a blockchain.” He went on to explain that the ultimate goal would be to trade assets with reduced settlement times and do so in a secure fashion. To do this Cascarilla says Paxos would retain the cash, gold, stocks, etc. to correspond to what’s in the blockchain. As he put it, “How you do it with a gold token is how much gold you have in a vault equals how many gold tokens outstanding. How do you do it with stocks? How many stocks do I have sitting in an account, equals how many stocks in the blockchain.”
Cascarilla says Paxos is getting closer to making such offerings a reality. In fact he predicts they could arrive sometime this year as the company has already tested blockchain transactions for bonds and stock market equities. Of course potentially getting in the way of any potential launch is the fact that Paxos would need to gain approval from the Securities and Exchange Commission if it were to offer crypto token tied to securities. Not surprisingly then, Cascarilla suggest they would start with commodities, saying, “[G]old is probably the most obvious,” adding the company would “definitely” launch that asset in 2019
Although Paxos’s upcoming efforts may still be described by some as cryptocurrencies, others will certainly take issue with that classification. Nevertheless, with these planned tokens, the company is pushing the possibilities of blockchain forward. It’s also notable that getting the SEC involved could also bring some added legitimacy to their efforts if/when that were to happen. It remains to be seen about what the regulators will have to say about Paxos’s ideas but it will be interesting to see if stocks and blockchain technology can come together in the near future.
