What is USDP?
USDP Token is the token of the Paxos platform built on Ethereum blockchain technology (ERC-20 protocol) in 2018. USDP Token is fully backed 1:1 USD issued by the Paxos Trust Company and is approved and regulated by the NYS Department of Financial Services. PAX is also known as USD Digital.
Like other stablecoins such as USDT, PAX aims to combine the stability and reliability of the US dollar with the benefits of digital money. Namely, to make it so that it can be transmitted via the Internet to anyone on the planet, instantly, at any time and practically without commissions.
Features of USDP
- PAX is the first stablecoin to be fully backed by the US dollar.
- PAX can only be created when new US dollars are entered into the Paxos system. One new PAX token is created when a person sends one US dollar to Paxos, which ultimately goes to Paxos' regulated bank account. PAX are not created or spawned prior to their purchase, so the total PAX supply is entirely dependent on the demand for the token.
- The entire volume of PAX tokens released to the market is covered by US dollars, which are stored in banks with insurance from the Federal Deposit Insurance Corporation. The auditing company Withum checks on a monthly basis that these banks have dollar reserves.
Disadvantages of USDP
- Unoriginal concept and software basis. The creators of PAX are constantly focusing on the originality of their cryptocurrency, but in reality they do not offer any innovative solutions to the market. In fact, we can say that the USDP stablecoin is a classic ERC-20 token.
- Blockchain.com is promoting PAX called USD Digital. By this she greatly confuses her clients.