Paxos, a crypto exchange and stablecoin issuer has launched a gold-backed crypto asset called Pax Gold (PAXG). The Ethereum-based token has been approved by the New York Department of Financial Services.
Each token of new crypto is actual legal title to a physical bar of gold stored in the Brink’s London vault.
A PAXG token costs as an ounce of gold. It can be redeemed for a physical bar at partnering institutions such as Bullion Exchanges in New York. Moreover, the crypto loan startup SALT offers PAXG-backed loans, available in fiat or stablecoins such as PAX, TrueUSD or USDC.
For traders who might want to buy gold on-the-go and then pick it up in another location, Cascarilla believes Pax Gold could offer a regulated alternative to physical ownership.
However, Bitcoin skeptics don’t believe a relatively fungible cryptocurrency would bring new and compliant use cases to the broader gold market. It still requires a know-your-customer process.