Stablecoin issuer Paxos has gotten the regulator approval from the New York Department of Financial Services (DFS) to expand to Solana blockchain.
Until now, it had been limited to just Ethereum ($ETH) due to restrictions imposed by the DFS.
Paxos is scheduled to offer USD-backed stablecoin $USDP on Solana from 17 January 2024. $USDP, like all Paxos stablecoins, is fully backed 1:1 by the US dollar.
The move will mark the first expansion of its stablecoins to a new blockchain.
According to Paxos’ official website, the firm got its first limited-purpose trust charter for digital assets from NYDFS in 2015. It also claims all of its operations to be supervised by the New York regulator.
The expansion of Paxos’ stablecoin platform to support Solana marks an “important step towards making stablecoins ubiquitous for everyday consumers”, said its Head of Strategy, Walter Hessert.
According to him, Paxos has set the standard for oversight, reserve management and issuance in the stablecoin market. The integration of $USDP with Solana ensures that users will get “to use the safest, most reliable stablecoins”.
Solana, which is a layer-1 protocol, is known for its high transaction speed and low cost. It surpasses Ethereum’s current capability by processing around 50,000 to 65,000 transactions per second (TPS).
Ethereum, on the other hand, can also do about 30 TPS. The co-founder of Solana, Raj Gokal, commented on the development, saying:
“Paxos’s decision to bring stablecoin issuance to the Solana blockchain will showcase how Solana’s high-performance network and low transaction fees can support regulated financial products and provide leaders like Paxos new ways to scale and innovate. The Solana network will enable Paxos to further its vision for a more open and financially empowering future.”
$SOL continues to rise
Solana’s native token $SOL has been in the news recently for strongly sustaining its bullish momentum.
The uptrend has taken the coin to a new yearly high, close to the $100 mark, this week. This was seen as a 750% increase since the start of 2023.
The token currently reigns as the fifth-largest cryptocurrency by market capitalisation, taking over $XRP’s spot with a valuation of over $40 million.
Its bullish price action was also accompanied by a surge in Solana’s trading volume, which surpassed Ethereum’s daily decentralised exchange (DEX) volume for the third consecutive day.
According to on-chain analytics platform Artemis, Solana’s daily DEX volume peaked at $1.55 billion on Friday, putting Ethereum behind with just $1.21 billion.
Solana’s growing popularity has also been evident in the surge of Google queries related to the cryptocurrency. According to Google Trends, searches for “Solana” reached their highest level, increasing 250% from early October to early December.
Additionally, $SOL has also broken the record in stablecoin metrics with a notable increase in stablecoin market cap and stablecoin growth on Solana this month. The former figure currently stands at over $1.7 billion, which is a level last seen in March.
