Crypto firm Paxos has formed a fresh entity in Singapore to launch a new USD-backed stablecoin in the country.
Paxos Digital Singapore Pte. Ltd. received in-principle approval from the Monetary Authority of Singapore, Paxos said late Wednesday. The new entity will issue a USD-backed stablecoin that will comply with Singapore's recently finalized stablecoin regulatory framework before the legislative amendments take effect.
In August, MAS finalized its framework for regulating stablecoins, applicable to single-currency stablecoins pegged to the Singaporean dollar or any G10 currency, including the U.S. dollar. Crypto firms aiming to recognize their stablecoins as "MAS regulated stablecoins" must comply with the framework.
"Paxos is one of only two companies, alongside StraitsX, to get this approval from MAS," a Paxos spokesperson told The Block. "We will issue a new stablecoin with all new branding. That's because it is done from Singapore."
Paxos does not yet have a name or specific details for the new stablecoin, aside from it being USD-backed and issued by the firm's new Singapore entity, the spokesperson said.
Expanding to Singapore
Paxos already offers a USD-backed stablecoin called USDP -0.05% from its home country, the United States. The Singapore entity was established to ensure compliance with local regulations and to facilitate partnerships with enterprise clients for issuing the USD-backed stablecoin in Singapore — similar to Paxos's PayPal partnership in the U.S.
In August, PayPal launched a USD-backed stablecoin called PYUSD, which is issued by Paxos. Binance was also once a Paxos partner for the crypto exchange's BUSD stablecoin. However, Paxos no longer mints BUSD after the New York Department of Financial Services ordered it to cease the stablecoin's issuance.
Paxos Digital Singapore Pte. Ltd. is Paxos's second Singapore-based regulated entity. The first entity obtained a license from MAS last year to provide digital payment token services under the country's Payment Services Act 2019. At that time, Paxos claimed to be the first U.S.-based crypto firm to obtain that license. That license enabled Paxos to onboard Singapore-based customers for its crypto brokerage platform, which allows them to buy, sell, hold, send, and receive cryptocurrencies, the spokesperson said today.
Paxos is backed by high-profile investors, including Bank of America, Peter Thiel's Founders Fund and Coinbase Ventures. The firm has raised over $540 million in total funding to date and was valued at $2.4 billion during its latest Series D round in 2021.
Updates the Paxos spokesperson's quote to include StraitsX.
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