PAX Gold (PAXG): Project Review, Recent Developments, Future Events, Community

• Issued by Paxos, PAX Gold (PAXG) is a gold-backed crypto that gives investors of all classes access to the commodity.
• Paxos has received a license from Singapore’s MAS and can now offer PAX Gold and other cryptos in the country.
• Paxos has also outlined recommendations for how stablecoins can be safely issued globally.
• PAXG has been more stable than most cryptos while slowly trending upwards, gaining 9.7% in the last three months.

Project Review

PAX Gold (PAXG) is a gold-backed ERC-20 token launched by Paxos, the creators of the Paxos Dollar stablecoin and itBit crypto exchange and the sole issuers of the BSUD stablecoin. 

Paxos launched PAX Gold in September 2019 to make gold more tradable since the physical commodity is not as easily accessible, divisible, or flexible in terms of transportation. It is entirely backed by a piece of a London Good Delivery gold bar.

PAXG is pegged to the price of gold, and the gold bars held by Paxos are stored in the vaults of Brinks, an approved storage company. PAXG allows investors to buy and hold small amounts of gold, eliminating the minimum buy entry for the commodity. 

Being stored on a blockchain is also an added advantage, as investors need not worry about storing and securing physical gold. Regulated by the London Bullion Market Association (LBMA), PAXG can be redeemed for actual bullion.

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Recent Developments and Future Events 

Paxos, the issuer of PAXG, has continued leading developments for regulated blockchain infrastructure platforms. Last month Paxos received a license from the Monetary Authority of Singapore (MAS) to offer digital payment token services in the country.

Paxos can now offer the PAXG and its other digital assets and blockchain services in Singapore. The license makes Paxos the first U.S.-Based blockchain infrastructure platform to secure regulatory oversight in the key financial hubs of New York and Singapore.

To assure users of the safety of their funds amidst the growing volatility and distrust in the crypto industry, on December 13th, Paxos’ treasury and operations departments processed more than $3 billion in customer stablecoin redemptions.

The experiment from Paxos, which holds the first limited-purpose trust charter for digital assets from the New York Department of Financial Services (NYDFS), was to reassure users that the company’s reserves and corporate controls can withstand any external stress.

Paxos has also submitted its recommendations to the Financial Stability Board (FSB) on how best agencies can safely regulate a global, fiat-backed stablecoin and its issuer. Paxos notes that stablecoins should be overseen with the “same activity, same risk, same regulations” used in traditional finance.

However, Paxos argues that the Money transmitter licenses (MTLs) and money services business licenses (MSBs) are insufficient for the safe issuance of stablecoins. Paxos believes that stablecoin issuers should follow a strict framework to protect consumers.

Paxos has also partnered to launch Crypto SourceTM, a first-of-its-kind technology solution designed to enable financial institutions to bring secure crypto trading capabilities and services to their customers.

By partnering with MasterCard, its financial institution partners a suite of buy, hold and sell services for select crypto assets. It is augmented with proven identity, cyber, security, and advisory services.

Price Updates

PAX Gold (PAXG), being pegged to gold, has been one of the more stable digital assets next to stablecoins. However, unlike stablecoins, PAXG has been steadily – albeit slowly – trending upwards.

The 24-hour price chart for PAX Gold (PAXG). Source: CoinMarketCap

PAXG has gained 0.21% over the last 24 hours and 0.90% in the last seven days. However, while most cryptos are down double digits over the last three months, the price of PAXG has gained 9.83%.

The three-month price chart for PAX Gold (PAXG). Source: CoinMarketCap

The stability of PAXG made it one of the most used cryptos just after the FTX collapse. Its trading volume jumped from $7.5 million on November 6th to over $164 million on November 12th. PAXG is ranked as the 65th largest crypto, with a market cap of $490 million.

On the Flipside

• Unlike traditional cryptocurrencies, users holding PAXG can only expect gains and large price movements when the commodity, gold, makes an impulsive move in the market. 

Community

While Paxos Gold may not enjoy the robust community of most traditional crypto projects, members are great believers in the project. This is thanks to PAXG being backed by actual gold. PAX Gold community members are also great believers in gold’s durability as a store of value.

Commenting on the business model of PAX Gold, crypto and DeFi scholar Sébastien Derivaux wrote;

Highlighting the strong performance of PAXG amidst the FTX collapse, one Twitter user, @somethingpool, wrote;

Reacting to the soaring volumes of PAXG, user @Contang96753615 wrote;

Why You Should Care

PAXG allows investors who otherwise wouldn’t have had access to buying gold to own the asset. As long as gold remains a store of value, the use of PAXG is bound to persist. With over $3.5 trillion of the total gold available today used for investment, PAXG can become a major driver for retail investors looking to hold gold.