Paxos Issuing $100 Million in Stablecoins
According to the latest news reports, Paxos will be issuing up to $100 million worth of its stablecoin, PAX, on the Ontology blockchain. This stablecoin is anchored to the dollar on a 1:1 ratio, and it will be launched on its new network next month.
Ontology announced on Friday, April 26 that the launch of this stablecoin on its network would make it easier for individuals as well as businesses using its native token ONT to carry out transactions in stablecoins.
Creating a Second Option
PAX (Paxos Standard) was launched last year in September on Ethereum’s blockchain as an ERC-20 token. This stablecoin is completely regulated and backed by the US dollar.
Now, PAX will also be available on the Ontology blockchain as a second option. This new version of PAX will have the same ticker symbol however, it will follow Ontology’s OEP-4 blockchain standard.
Andy Ji, the founder of Ontology stated that the launch of the stablecoin on his company’s network would significantly speed up real business applications. It would also help in the creation of more success stories about traditional businesses migrating to distributed businesses, and would also give institutional investors as well as enterprise partners a reliable, safe and regulated gateway to the cryptocurrency space.
Reaction to Bitfinex-Tether Scandal
Over 10 million PAX stablecoins were minted 18 hours after the Bitfinex-Tether scandal broke, in which the New York Attorney General’s Office accused the two affiliated companies of having broken several laws and defrauding their customers.
According to the Chief Executive Officer of Paxos Chad Cascarilla, there was a massive surge in the demand for PAX stablecoins overnight. He stated that they had had to mint PAX stablecoins throughout the day and well into the night due to this huge demand.
Cascarilla felt that the increase in the demand for their stablecoin was a direct result of the news about Bitfinex and Tether, since the PAX token started trading at a much higher premium to both the stablecoin Tether (USDT) and the dollar.
He also stated that Paxos did not pre-mint their stablecoin, so the volume of PAX was going up or down based on the demand in the market for Paxos dollars.
According to the blockchain data, exactly 13,737,199.87 new PAX tokens were created of which 3,354,741.74 were already redeemed, taking the net increase in PAX token to 10 million.
PAX was not the only stablecoin to see a spike in its demand. USD Coin, another stablecoin issued by the Circle-Coinbase consortium also saw demand for its tokens shoot up. There were 8,276,917.27 new USD Coins minted after the news about Tether and Bitfinex broke.