What is Global Dollar (USDG)?

USDG is a single-currency stablecoin pegged to the US dollar, fully redeemable from Paxos at a 1:1 ratio (1 USDG = 1 USD). Issued as an ERC-20 token on Ethereum and using standard token protocols on other MAS-approved blockchains, it ensures seamless integration with exchanges and third-party applications.

Key features of USDG include:

• Accessibility: Anyone with an Ethereum-compatible wallet can send or receive USDG, breaking down barriers to traditional banking access.

• Speed: Transactions settle in minutes on Ethereum and other high-speed networks, far faster than traditional fiat transfers that can take days.

• Programmability: Operating under ERC-20 rules, USDG supports smart contracts, enabling developers to build new use cases, products, and services.

• Stability: Pegged to the US dollar, USDG’s reserves are held in segregated accounts by PDS, protecting holders’ assets in the unlikely event of insolvency.

• Regulated Issuer: PDS holds a MAS Major Payment Institution license, offering digital payment token services and meeting stablecoin framework requirements for value stability, capital, par redemption, and disclosures.

USDG’s reserves, consisting of cash and cash equivalents, are held in segregated accounts; US dollars are T+0 liquid. US Treasury securities (USGs) with less than three months to maturity are highly liquid, while reverse repurchase agreements (repos) are overcollateralized with USGs and limited to one business day. Institutional Stable NAV USD Government Money Market Funds (MMFs) include cash, USGs, and overnight repos with a weighted average maturity (WAM) of 60 days and weighted average life (WAL) of 120 days.

Purpose of Global Dollar (USDG)

USDG aims to foster a fair and open financial system through regulated stablecoins. Over the past five years, the stablecoin market has grown 15x to over $160 billion, with projections to reach $3 trillion in the next five years. Blockchain advancements in speed and cost-efficiency make stablecoins ideal for payments and real-time money movement. Announcements like PayPal’s PYUSD and Stripe’s adoption of stablecoins for payments highlight strong enterprise demand.

Many existing stablecoins lack high regulatory standards, hindering enterprise adoption. USDG, under MAS oversight, offers robust consumer protection and compliance, reducing the cost and friction of enterprises issuing their own stablecoins. Its cash and cash-equivalent reserves are held in segregated accounts, safeguarding USDG holders in case of PDS insolvency.

How Does Global Dollar (USDG) Work?

USDG is issued and redeemed at a 1:1 ratio with USD; PDS mints tokens when funds are deposited into a reserve bank account. Other USDG transactions are managed by smart contracts under ERC-20 or approved blockchain protocols. The USDG smart contract is audited by independent third parties and viewable on Etherscan.

Reserves: USDG is fully redeemable, with reserves matching the circulating supply 1:1. Cash is held in segregated bank accounts; USGs with less than three months to maturity are liquid. Repos, overcollateralized with USGs, have a one-business-day maturity limit; MMFs include cash, USGs, and overnight repos with 60-day WAM and 120-day WAL.

Reserve Investment Policy: Paxos prioritizes asset safety and liquidity, implementing intraday liquidity management. Single-bank exposure, liquidity needs, and redemption timelines are assessed. The portfolio follows a buy-and-hold strategy, with liquid, short-maturity assets enabling flexible cash flow management.

Auditing and Verification: An independent accounting firm conducts monthly reserve attestations, published on the Paxos website and submitted to MAS. Verification includes: checking USDG total supply via blockchain, confirming USD balances with banks, matching internal PDS records, verifying reserve excess, drafting and signing reports, and publishing them.

Transaction Monitoring and Oversight: Continuous monitoring for fraud detection and prevention is performed using Chainalysis, with public blockchain transaction history accessible to all.

Global Dollar (USDG) Use Cases

USDG delivers the benefits of fiat-backed stablecoins: accessibility (available outside banking hours), access (usable with Ethereum wallets), speed (settles in minutes), and programmability (enables new smart contract applications).

USDG stands out from other USD stablecoins with: MAS-regulated issuance, partnerships with banks like DBS, experience issuing PayPal USD under New York Department of Financial Services, and issuance of Lift Dollar (USDL) under ADGM Financial Services Permission.

Risks: USDG or its reserves may be frozen, seized, or forfeited for illegal or sanctioned use. Consumer risks include: public blockchain delays, third-party software failures, irreversible transactions, and private key loss.

Global Dollar (USDG) Tokenomics

USDG is backed 1:1 with USD reserves, matching circulating supply. Reserves, held in segregated accounts with cash, USGs, repos, and MMFs, remain liquid. Monthly attestations, quarterly/annual audits, and on-demand verifications ensure transparency.

Global Dollar (USDG) Partners

Global Dollar (USDG) partners include a diverse range of finance and blockchain companies: 1Money, Aleo, Alfred, Alpaca, Amina, Anchorage Digital, Aquanow, Arculus, August, Beam, BiLira, Bitmart, Bitnet, Bitwyre, Bullish, Caliza, Coinmena, Coinmetro, Coinspaid, Dtc Pay, Equitiestracker, Facilita Pay, Fomo Pay, Galaxy, Gate, Hercle, Hifi, Huma, Kraken, Loopcrypto, Ltp, Merj, Midas, Noah, Nuvei, OKX, Onramp, OnRe, Orbital, Paribu, Paxos, Pdax, Rain, Rakkar, Robinhood, Sling Money, Swissborg, Toku, Topos, Trace Finance, Triple-a, Velocity, Wallectconnect, Worldpay, and Zodia Custody.

Global Dollar (USDG) Team

The Global Dollar Network is an open platform to accelerate USDG adoption, issued by PDS under MAS oversight. Paxos, a regulated stablecoin issuer since 2018, has minted over $120 billion in stablecoins. It operates under a New York Trust Charter and ADGM Financial Services Permission.

Official Links

• Website
• X (Twitter)
• Whitepaper

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Now, Ondo Finance has taken a major step forward in bridging traditional finance with crypto by enabling instant conversions between Ondo Short-Term US Government Treasuries (OUSG) and PayPal USD (PYUSD).

Seamless 24/7 Conversions Between Stablecoin and Treasuries

With the new feature, users can now mint OUSG using PYUSD and instantly redeem their holdings back to PYUSD—24/7. The $25 million facility supporting these conversions makes it one of the largest gateways between stablecoins and tokenized money market funds.

You Might Be Interested In: Elon Musk Talks About the Name of a New Memecoin!

Nathan Allman, CEO of Ondo Finance, stated: “Enabling OUSG to PYUSD redemptions expands our clients’ trusted settlement options. We’re proud to deepen our collaboration with PayPal.”

Ondo Nexus: A Major Leap for Tokenized Treasuries

This update also advances Ondo Nexus, a technical initiative focused on enhancing instant redemption liquidity for tokenized treasuries. By incorporating PYUSD, Nexus enables broader support for real-world assets (RWAs), increasing their utility and accessibility.

OUSG now holds over $525m in total value locked and remains the only tokenized treasury product offering fee-free 24/7 redemptions. The fund includes investments in vehicles like BlackRock’s BUIDL, Franklin Templeton’s FOBXX, WisdomTree’s WTGXX, and FundBridge Capital’s ULTRA, all integrated into Ethereum and Solana chains.

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Until March 31, Tokens Can Be Converted

Crypto.com will stop trading USDT and nine other tokens as of January 31. However, users will have until March 31, 2025 to withdraw or convert these tokens into MiCA-compliant assets. Any tokens not converted after this date will be automatically converted by the exchange into MiCA-compliant stablecoins or assets equivalent in value.

Crypto.com’s representative stated that this process is an important step to protect users and ensure full compliance with the regulatory framework.

Which Tokens Will Be Delisted?

Among the tokens that Crypto.com will delist are the following:

• Tether (USDT)
• Wrapped Bitcoin (WBTC)
• Dai (DAI)
• Pax Dollar (PAX)
• Pax Gold (PAXG)
• PayPal USD (PYUSD)
• Crypto.com Staked ETH (CDCETH)
• Crypto.com Staked SOL (CDCSOL)
• Liquid CRO (LCRO)
• XSGD (XSGD)

These tokens are being delisted in line with the European Securities and Markets Authority’s (ESMA) announcement to limit non-MiCA-compliant stablecoins as of January 31, 2025.

Expanding Delist Trend for Tether (USDT)

Crypto.com’s delisting of USDT is one of the latest developments in the process of European exchanges and service providers adapting to MiCA regulations. Coinbase had delisted USDT in October 2024 on the grounds that it was not MiCA-compliant . Coinbase had given its customers the option to convert their USDT into MiCA-compliant stablecoins, specifically Circle’s USDC.

With MiCA in full effect, many crypto asset service providers in Europe have obtained or are working to obtain MiCA licenses. Crypto.com is also in the process of obtaining a license in Malta.

The Competition Between USDT and Its Rivals

USDT is the largest stablecoin in the market with a market capitalization of $139 billion. However, its rival USDC, which benefits from MiCA compliance, is currently in second place with a market capitalization of $52 billion. Circle’s USDC was approved as MiCA-compliant in July 2024, enabling the USDC to gain acceptance in the European market.

Impact of MiCA Regulations on the Industry

MiCA regulations aim to make the operations of crypto asset service providers more transparent and compliant. However, the fact that the market’s largest stablecoins, especially USDT, are not covered by MiCA may affect investors’ preferences. After March 31, USDT is expected to be completely abolished in Europe, and the impact of this on the market is a matter of curiosity.

Crypto.com’s move is seen as an important milestone on the road to compliance with MiCA regulations. However, these changes could reshape the dynamics of the cryptocurrency market.

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