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Paxos are to Introduce a Cryptocurrency Backed by Gold

By Jamie Green – Crypto Dealer

Paxos Technology Solutions LLC, the company that launched the 1:1 dollar backed Paxos Standard Token (PAX), have announced plans to introduce a gold and precious metal backed cryptocurrency. The company has also stated plans to introduce publicly traded stocks during this year.

The CEO has expressed his enthusiasm to bring the concept of tokenising a commodity, though this idea has been circulating around the crypto space. A token like this will allow investors to sell bitcoin for a token based on the value of gold and trade it. Gold is the most obvious choice and has been theorised in the past by traditional financial institutions but as yet not through a blockchain.

For the concept to work, Paxos must ensure that when a user seeks to exchange Bitcoin for the gold-backed token, they hold the exact amount of inventory that has been recorded on the blockchain. Tokenisation also allows for the division of a gold bar. An investor will be able to sell crypto for a portion of the gold bar as opposed to paying and owning a whole bar. The transportation of the gold is another issue tokenisation will address as the value can be transacted easily without the physical asset moving.

Paxos has a strong focus on transparency and trust as the PAX token is fully audited and regulated under the New York State Department of Financial Services. Paxos is also the only cryptocurrency company with an account at the Depository Trust Company, a highly reputable firm holding many US stocks and bonds.

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