New-York based exchange and stablecoin maker Paxos has launched a new cryptocurrency that will be backed by gold.
The cryptoasset, which was launched on Sept. 5, will be called Pax Gold (PAXG) and based upon ethereum’s blockchain as an ERC-20 token. Each PAXG will be backed by the value of a physical bar of gold stored in Brink’s London vault.
While the new coin is being touted as a digital crypto-asset, it also serves as a legal title to owners hoping for a more convenient way to own physical gold. Pax Gold has been officially approved by the New York Department of Financial Services, according to a press release published on Sept. 5.
NEW: @NYDFS has approved PAX Gold (PAXG)! Real, physical gold on the blockchain, launched today. Read more in @FortuneMagazine by @jeffjohnroberts "Crypto or Gold? Paxos Offers Both With First Gold-Backed Token" https://t.co/x8q4DAOrajMore info: https://t.co/hNCruyKqX1— Paxos (@PaxosGlobal) September 5, 2019
Paxos CEO Chad Cascarilla told CoinDesk that the token has the potential to elevate into a new class of crypto-asset,
“It’s not a representation of the commodity, it’s actual legal title to it. This is the exact point of the blockchain, the exact premise, that you can now make [assets] easily moveable and divisible and not be tied to a manual, physical process.”
“We’re going to do more products like this where we are taking real-world assets and putting them on the blockchain.”
While bitcoin has been touted as ‘digital gold,’ and is increasingly being referred to as a ‘safe haven’ asset, the new PAXG token will test the appetite of crypto investors for traditional precious metals.