Paxos is a foundational contributor to the fast-growing, mainstream adoption of digital assets. To achieve our mission of creating an open, digital economy, Paxos utilizes Ethereum, a decentralized, open-source blockchain with smart contract capabilities.
Because of its capabilities and reliability, Paxos issues its market leading, fully-regulated USD-backed stablecoins BUSD and USDP – as well as PAXG, our regulated, physical gold-backed token – on Ethereum. We offer custody, trading and transfers support for all of these tokens, in addition to the – the ETH digital currency, which is native to the Ethereum protocol and the second largest cryptocurrency in the marketplace today.
Ethereum is a compelling protocol with a thriving community that constantly refines and expands the network’s functionality. This is why we are not alone in our excitement about the upcoming Ethereum Merge and the potential scaling improvements it is expected to enable. Paxos plans to follow the greater Ethereum community by supporting the main Proof of Stake (POS) Ethereum chain. We believe this chain will set the stage for further scalability upgrades and faster throughput.
The upcoming merge will not impact the reserve assets that back Paxos-issued stablecoins. As disclosed on our Monthly Reserve Holdings Reports, the assets that back USDP and BUSD are limited and include only US treasuries, bank deposits and overnight reverse repurchase agreements secured by US treasuries.
Paxos will not support any forked tokens that may be created as a result of the merge; our customers will not be able to claim or withdraw forked tokens from our platform. In the future, Paxos may decide to support and list forked tokens; if that happens, forked tokens will have to undergo our strict review processes and we do not guarantee any future listing of these tokens.
We’re excited for these upgrades to the network and the future of Ethereum. We expect minimal downtime during this merge and we’re focused on supporting speedy conversions and redemptions of our stablecoins at all times.