Coins covered in precious metals seem to be gaining in popularity. As the blockchain trust company Paxos announced now, a gold-covered stable coin is expected to appear later this year. An exact date is not fixed yet.
New York City-based Paxos appears to be releasing a stable gold-covered coin this year. Paxos has the vision to redesign the financial structures. According to its own statement, the company wants to contribute to the fact that assets worldwide can be moved without barriers.
Paxos follows a path that is closely aligned with the current regulations of the financial infrastructure and develops products accordingly. According to the company, this allows the company to create an interface between the traditional financial world and the digital future. As Paxos CEO Chad Cascarilla emphasized in an interview, this year, an Ethereum (ETH) based stable coin will be published. Cascarilla emphasized that the Paxos stable coin will be different from other stable coins. According to its own statement, the coin should be fully audited, strictly regulated and approved by the New York State Department of Financial Services.
What problem solves Paxos?
Currently, Paxos solves precious metal trading problems that are not based on a blockchain solution. When trading in the precious metal market, parties involved in a trade must review the price, volume and other details prior to the transaction. This is often done by e-mail or even by phone.
Paxos CEO Chad Cascarilla estimates that the error rate in manual trade confirmations for precious metals is around 15 percent. The Confirmation Service, published by Paxos in May 2018, can automate this process and coordinate the trades immediately.
Tokenized precious metals therefore seem to be a logical consequence for Paxos. A simpler and faster transaction possibility of assets could be the result. Customers can exchange digital twins without being exposed to the volatility of a fiat currency.
However, Paxos is not the only company looking at asset tokenization. Other companies also believe that asset tokenization via Blockchain will become standard in the future. It was only recently that New York-based start-up Factora announced its intention to make a property in Brooklyn.