Blockchain and tokenization infrastructure platform Paxos is expanding its stablecoin issuance to the Solana blockchain, the first expansion beyond Ethereum.
The firm said Solana was selected for its “rapid transaction rates and lower transaction fees, which makes it a compelling network for US dollar stablecoins and payments.”
Paxos, which issues a wide range of stablecoins including the PayPal USD (PYUSD) from the payments giant, will be bringing its USDP coin to Solana. USDP, which is one-to-one pegged to the U.S. dollar, will go live on the blockchain for the general public on Jan. 17.
“The expansion of our stablecoin platform to support Solana marks an important step towards making stablecoins ubiquitous for everyday consumers,” said Walter Hessert, Paxos head of strategy, in the announcement post. “Paxos has set the standard for oversight, reserve management and issuance in the stablecoin market. By integrating USDP with Solana, we’re making it easier for anyone to get and use the safest, most reliable stablecoins.”
Paxos products and its platform are regulated by the New York State Department of Financial Services (NYDFS), which means this move has gotten a regulatory stamp of approval, as was confirmed in a Fortune exclusive.
However, being a regulated company hasn’t exempted Paxos from regulatory ire. In February, Paxos ran into some troubled waters regarding its issuance of the stablecoin from crypto exchange giant Binance, BUSD.
The NYDFS said in a consumer alert that it had ordered Paxos to stop minting BUSD due to “several unresolved issues related to Paxos’ oversight of its relationship with Binance.” Later that same day, Paxos revealed that the U.S. Securities and Exchange Commission (SEC) had said the company should’ve registered BUSD as a security and was considering taking action against the platform. Paxos agreed to terminate support for BUSD by February 2024, and Binance eventually joined that timeline in ending support for its stablecoin.
The news has provided yet another boost for the Solana ecosystem and its native SOL token. SOL has soared over 832% year-to-date for the current price of $93.91. The Paxos announcement also comes days after the layer 1 blockchain took the lead in daily stablecoin transfer volume for the first time, beating out even Ethereum.