Paxos, the leading regulated blockchain infrastructure platform, issued the following statement from its CEO and Co-Founder Charles Cascarilla in response to the New York State Department of Financial Services’ (“DFS”) new Regulatory Guidance, setting foundational criteria for USD-backed stablecoins:
We applaud the DFS for issuing clear and straightforward guidance on the issuance of USD-backed stablecoins, and for underscoring the need to protect consumers and ensure responsible innovation across the industry. We believe these guidelines provide a strong foundation for the regulatory oversight of stablecoin issuers and tokens moving forward. Paxos is proud to already meet DFS’ regulatory guidance.
As regulators, legislators and policymakers seek to design appropriate standards and integrate recent advances in financial technology into our economy, we would like to commend the DFS, and Superintendent Adrienne Harris, on their continued leadership in setting prudential standards for the licensing, issuance and custody of digital assets including stablecoins. DFS’ vision has created a responsible place for innovators like Paxos to create exciting products with consumer protections always in mind. We were proudly the first DFS-regulated Trust company for digital assets and the first to achieve regulatory approval for stablecoin issuance. Paxos-issued, DFS-regulated stablecoins USDP and BUSD are the safest US dollar-backed assets available today. Since the DFS requires Trusts to hold all customer funds bankruptcy remote and in segregated accounts, we can ensure customers funds are always available. And because we’re required to hold reserves in only cash and cash equivalents, our stablecoins are and always will be one dollar.
These new technologies can play a key role in the security and efficiency of 21st century financial markets, provided that standards of prudential oversight are put in place. The United States has led the way in setting high standards and regulatory guardrails for global financial markets. The global preeminence of the US dollar and US capital markets have been the result of this leadership. We hope that as key decision makers consider the evolution of these frameworks for digital assets that they seize the leadership mantle once again, and consider bold yet common sense measures that will protect consumers and ensure the US financial system will continue to be a model that other countries emulate.