Paxos (USDP) Research Report

Paxos (USDP) Positioning and Significance

In 2018, Paxos launched Paxos Standard (later renamed Pax Dollar, USDP in August 2021), aiming to solve the challenges of providing compliant, stable digital alternatives to cash for crypto asset traders and institutional investors.

As the world's first regulated stablecoin, USDP plays a critical role in enabling real-time transaction settlement across all asset classes and providing liquidity for cryptocurrency investors. The token is fully backed by US dollars held in FDIC-insured accounts and is regulated by the New York Financial Services Department (NYDFS).

As of December 2025, USDP has established itself as a trusted compliance-focused stablecoin, maintaining a market cap of approximately $51.5 million with a 24-hour trading volume of $2.18 million and over 110,000 token holders. The active development team and strong regulatory backing position USDP as a key infrastructure asset for institutional-grade cryptocurrency transactions.

This report provides a comprehensive analysis of USDP's technical architecture, market performance, and role in the cryptocurrency ecosystem.

Origins and Development History

Background and Launch

Paxos was established to address the critical need for regulatory compliance in the stablecoin space and to provide institutional-grade trust and custody solutions for cryptocurrency market participants. The project emerged during a period of rapid cryptocurrency adoption, when traditional stablecoins lacked proper regulatory oversight and institutional safeguards.

Paxos Standard was developed to serve as a "digital alternative to cash" that combines the benefits of blockchain technology—such as instant global transfer, immutability, and decentralized accounting—with the stability and legal compliance required by institutional investors and regulated financial entities.

Key Milestones

• September 2018: Paxos Standard (PAX) launched as an ERC-20 token on the Ethereum blockchain, becoming the world's first regulated stablecoin issued by a trust company.

• Regulatory Approval: Secured ongoing supervision from the New York Financial Services Department (NYDFS), establishing a framework for compliant stablecoin issuance.

• August 25, 2021: Paxos Standard (PAX) officially rebranded to Pax Dollar (USDP) as part of the company's strategic repositioning in the stablecoin market.

• Continued Expansion: USDP became available across multiple cryptocurrency platforms and exchanges, including Gate.com, expanding accessibility for global traders and institutions.

Throughout its development, Paxos has maintained its core commitment to compliance, custody best practices, and capital preservation, with team members bringing extensive experience from Wall Street finance and Silicon Valley technology sectors.

How Paxos (USDP) Works?

Full USD Backing and Custody

USDP operates on a 1:1 USD backing model, where every issued token is backed by one US dollar held in reserve. These US dollar deposits are held in separate accounts at multiple FDIC-insured, US-registered banks, providing customers with significant asset protection compared to other stablecoins.

Paxos, operating as a trust company, serves as the custodian and trustee of customer funds, implementing institutional-grade custody practices and regulatory compliance standards.

Blockchain Foundation

USDP is built on the Ethereum blockchain as an ERC-20 token, leveraging Ethereum's security and widespread adoption:

• Immutable Record: All USDP transactions are recorded on the public Ethereum ledger, creating an auditable and tamper-proof transaction history.

• Cryptographic Security: Transactions are secured using public-private key encryption, ensuring that only token holders with valid private keys can authorize transfers.

• Instant Settlement: As a blockchain-based asset, USDP enables 24/7 global settlement without intermediaries, allowing instant transfers between any two Ethereum wallets worldwide.

• Transparency: The entire transaction history is publicly verifiable on the Ethereum blockchain via explorers like Etherscan.

Token Economics and Supply Control

USDP operates under a fully transparent supply mechanism:

• Minting and Burning: Tokens are created and destroyed through a supply controller address that maintains the 1:1 USD reserve ratio. When customers purchase USDP, new tokens are minted; when customers redeem USDP, tokens are burned.

• Total Supply: Currently 51.57 million USDP in circulation, with 100% reserve backing (circulating supply equals fully diluted valuation).

• Transparent Operations: USDP's code is open-source and available on GitHub, allowing independent verification of the smart contracts governing token creation and destruction.

Regulatory Compliance and Trust

Unlike unregulated stablecoins, USDP incorporates multiple compliance safeguards:

• NYDFS Regulation: Ongoing supervision by the New York Financial Services Department ensures adherence to strict capital reserve requirements and operational standards.

• Institutional Trust: Paxos's status as a regulated trust company provides legal protections and professional custody standards.

• Verified Access: Only verified Paxos customers can directly purchase or redeem USDP through the company's platform, maintaining compliance with anti-money laundering (AML) and know-your-customer (KYC) regulations.

• Cryptographic Security: Private key control ensures that only token holders can authorize transfers, while the immutable blockchain provides a permanent audit trail.

Market Performance and Current Status

Price Stability

USDP maintains its core design objective of price stability at $1 USD:

• Current Price (as of December 18, 2025): $0.9987
• 24-Hour Range: $0.9958 - $0.9989
• Market Cap: $51.50 million
• 24-Hour Volume: $2.18 million

The minimal price deviation reflects USDP's function as a reserve asset and medium of exchange rather than a speculative investment.

Market Position

• Market Rank: #493 among all cryptocurrencies
• Market Dominance: 0.0016% of total crypto market cap
• Token Holders: 110,086 addresses
• Exchange Listings: Available on 6 major cryptocurrency platforms

Historical Performance

• All-Time High: $1.502 (April 16, 2024)
• All-Time Low: $0.9824 (January 3, 2024)
• 1-Year Performance: -0.18% (reflecting modest price fluctuations within expected ranges)

Technical Specifications

Blockchain Details

• Network: Ethereum (ERC-20 standard)
• Contract Address: 0x8E870D67F660D95d5be530380D0eC0bd388289E1
• Type: Non-mineable, non-stakeable token
• Supply Model: Unlimited potential supply (backed by USD reserves)

Key Characteristics

• Minting/Burning: Only through Paxos's supply controller mechanism
• Transaction Speed: Instant settlement on Ethereum network
• Accessibility: Tradeable on Gate.com and other supported exchanges
• Verification: Open-source code available on GitHub for community audits

Official Resources

Website: https://www.paxos.com/standard/
Whitepaper: https://standard.paxos.com/whitepaper.pdf
Smart Contract Explorer: https://etherscan.io/token/0x8E870D67F660D95d5be530380D0eC0bd388289E1
GitHub Repository: https://github.com/paxosglobal/pax-contracts
Official Twitter: https://twitter.com/PaxosGlobal

Conclusion

Paxos (USDP) represents a significant milestone in the stablecoin ecosystem as the world's first regulated, institutionally-backed digital dollar. Its combination of full USD reserve backing, NYDFS regulatory oversight, and blockchain-based settlement capabilities makes it a preferred choice for institutional investors, traders, and users prioritizing compliance, safety, and trust.

With a stable price peg, transparent operations, and continuous institutional adoption, USDP continues to serve its core mission of providing a safe, compliant, and efficient digital alternative to cash for the global cryptocurrency market.

Paxos (USDP) Market Performance Report

Market Overview

Paxos Standard, rebranded as Pax Dollar (USDP) in August 2021, is the world's first fully compliant stablecoin. Issued by blockchain startup Paxos and regulated by the New York Financial Services Department, USDP serves as a digital alternative to cash, providing liquidity for cryptocurrency asset traders with instant transaction settlement capabilities across all asset classes.

Circulation Overview

As of December 18, 2025, Paxos (USDP) has a circulating supply of 51,569,455.21 USDP tokens, with a total supply of 51,569,455.21 USDP tokens. The maximum supply is unlimited, reflecting the nature of a stablecoin where supply expands and contracts based on user demand for minting and redemption.

USDP tokens enter the market through a controlled issuance mechanism based on smart contracts that regulate one-to-one transactions between USDP and US dollars. Token minting and burning operations are managed through a supply controller address, ensuring that the token supply remains dynamically responsive to market demand while maintaining full collateralization.

Price Performance

Current Market Status

As of December 18, 2025, USDP is trading at $0.9987, reflecting a minimal deviation from its $1.00 peg. The 24-hour price movement shows -0.01% change, demonstrating the stablecoin's characteristic price stability.

Historical Price Extremes

Paxos (USDP) reached its all-time high of $1.502 on April 16, 2024, during a period of broader cryptocurrency market strength and increased institutional adoption of stablecoins. Conversely, the lowest price recorded was $0.9824 on January 3, 2024, reflecting minimal deviation from the intended $1.00 peg, which is typical for well-collateralized stablecoins.

Price Trends

The following table illustrates USDP's price movements across different timeframes:

These minimal fluctuations underscore USDP's stability relative to other cryptocurrencies, confirming its function as a reliable medium of exchange and store of value.

Check the current USDP market price on Gate.com

Market Capitalization and Trading Volume

• Market Capitalization: $51,502,414.92
• 24-Hour Trading Volume: $2,183,649.05
• Market Dominance: 0.0016%
• Current Ranking: #493 by market cap

The trading volume relative to market cap reflects moderate liquidity, typical for stablecoins that serve primarily as settlement and liquidity provision instruments rather than speculative assets.

Token Economics

Technical Specifications:

• Token Standard: ERC-20 (Ethereum-based)
• Collateralization: 100% backed by US dollars held in FDIC-insured accounts at multiple US-registered banks
• Mint/Burn Mechanism: Controlled through smart contracts enabling one-to-one conversion with USD
• Mining/Staking: USDP is neither mineable nor stakeable; it can only be purchased or exchanged

Holder Distribution: USDP has 110,086 token holders, indicating a diverse distribution across multiple cryptocurrency market participants and institutions utilizing the stablecoin for various purposes.

Custody and Regulatory Framework

As a trust company, Paxos serves as both trustee and qualified custodian for client assets, providing institutional-grade protection for customer funds. All US dollar reserves backing USDP are maintained in separate accounts with multiple FDIC-insured US-registered banks, ensuring both security and regulatory compliance.

The New York Financial Services Department's oversight provides additional regulatory assurance, distinguishing USDP among stablecoin offerings in the cryptocurrency market.

Key Characteristics

Advantages:

• Full Regulatory Compliance: Supervised by the New York Financial Services Department
• Complete USD Collateralization: 100% backing provides price stability and redemption certainty
• Blockchain Benefits: Leverages Ethereum's immutability and decentralized accounting features
• 24/7 Trading: Enables instant, always-on transactions without banking hours restrictions
• Trust Company Structure: Provides enhanced asset protection compared to alternative stablecoins
• Open Source Code: Transparent smart contracts available on GitHub for community auditing

Use Cases:

• Instant transaction settlement across asset classes
• Cross-border value transfer
• Cryptocurrency trading pairs
• Institutional liquidity management
• Decentralized finance (DeFi) applications

References

• Official Website: https://www.paxos.com/standard/
• Blockchain Explorer: https://etherscan.io/token/0x8E870D67F660D95d5be530380D0eC0bd388289E1
• Smart Contracts: https://github.com/paxosglobal/pax-contracts
• Whitepaper: https://standard.paxos.com/whitepaper.pdf
• Official Twitter: https://twitter.com/PaxosGlobal

Report Date: December 18, 2025
Data Source: Gate.com Market Data

Paxos (USDP) Comprehensive Analysis Report

Overview

Paxos Standard, rebranded as Pax Dollar (USDP) on August 25, 2021, represents a significant milestone in the stablecoin landscape. As the world's first compliant stablecoin, USDP is issued by the blockchain startup Paxos and regulated by the New York Department of Financial Services. This regulatory oversight distinguishes USDP from many of its competitors in the stablecoin market.

Key Metrics (As of December 18, 2025)

Technical Architecture

Token Structure

USDP is built on the Ethereum blockchain following the ERC-20 standard, enabling seamless integration with the broader Ethereum ecosystem. Key technical characteristics include:

• Blockchain: Ethereum (ERC-20 compliant)
• Smart Contract Address: 0x8E870D67F660D95d5be530380D0eC0bd388289E1
• Collateralization: 100% backed by US dollar reserves
• Supply Mechanism: Controlled through a supply controller address for minting and burning operations
• Open Source: Code is publicly available on GitHub for transparency and community auditing

Operational Model

As an ERC-20 token, USDP is neither minable nor stakeable. Token creation and destruction are entirely dependent on:

1. Customer demand for purchasing or redeeming USDP
2. Smart contract operations that control one-to-one PAX-to-USD transactions
3. Fiat reserve backing maintained in segregated accounts

Core Value Proposition

Compliance and Regulatory Advantages

USDP distinguishes itself through regulatory compliance:

• Regulatory Oversight: Licensed and regulated by the New York Department of Financial Services
• Trust Company Status: Paxos operates as a qualified custodian and trustee for customer funds
• Reserve Security: US dollar deposits held in segregated accounts across multiple FDIC-insured US banks
• Full Convertibility: Users can redeem USDP for US dollars on a 1:1 basis

Use Cases

USDP serves multiple functions in the cryptocurrency ecosystem:

• Liquidity Provision: Offers liquid alternatives for crypto asset traders requiring real-time settlement
• Cross-Border Payments: Enables instant, 24/7 transactions across the Ethereum network
• DeFi Integration: Functions as a collateral and trading pair in decentralized finance applications
• Digital Cash Alternative: Provides immediate, unchangeable, and decentralized accounting benefits

Market Performance

Price Trends

Market Position

• Market Cap Dominance: 0.0016% of total cryptocurrency market
• 24h High/Low: $0.9989 / $0.9958
• Exchange Listings: Available on 6 cryptocurrency exchanges
• Circulation Ratio: 100% (all tokens in circulation are backed)

Ecosystem Applications and Partnerships

Integration Points

USDP's utility extends across the Ethereum ecosystem through:

• DeFi Protocols: Integration as a stablecoin trading pair and liquidity provision mechanism
• Smart Contracts: Used as collateral in various decentralized applications
• Ethereum Network: Direct utilization of Ethereum's security and infrastructure

The stablecoin can be transferred between any two wallets on the Ethereum network, making it inherently interoperable with the broader ecosystem.

Challenges and Considerations

Market Challenges

• Price Stability: Despite regulatory backing, USDP experiences minor fluctuations from the $1.00 peg
• Limited Adoption: Relatively smaller trading volume ($2.1M daily) compared to other major stablecoins
• Market Share: Low dominance percentage (0.0016%) indicates emerging market position

Regulatory Environment

• Jurisdictional Constraints: Regulatory approval from NYDFS provides US market confidence but may limit international expansion
• Evolving Landscape: Stablecoin regulations continue to develop globally, potentially affecting operational parameters

Competition

The stablecoin market remains highly competitive, with multiple alternatives offering similar or alternative value propositions. USDP's compliance advantage must be weighed against network effects and liquidity depth of competing stablecoins.

Community and Information Sources

Official Channels

• Official Website: https://www.paxos.com/standard/ - Comprehensive resource for features, updates, and redemption procedures
• Whitepaper: https://standard.paxos.com/whitepaper.pdf - Technical documentation detailing architecture and operational framework
• GitHub Repository: https://github.com/paxosglobal/pax-contracts - Open-source smart contract code for community review
• Block Explorer: https://etherscan.io/token/0x8E870D67F660D95d5be530380D0eC0bd388289E1 - On-chain transaction monitoring and analytics
• Twitter: @PaxosGlobal - Official announcements and community engagement

Holder Demographics

With 110,086 token holders, USDP maintains a distributed holder base, indicating growing adoption across the Ethereum ecosystem.

How to Acquire and Use USDP

Purchasing Options

1. Cryptocurrency Exchanges: Purchase USDP on Gate.com with stablecoins or cryptocurrencies
2. Direct Redemption: Verified Paxos customers can purchase or redeem USDP directly through the Paxos website

Storage and Management

• USDP can be held in any Ethereum-compatible wallet supporting ERC-20 tokens
• Storage through personal wallets ensures self-custody and security
• Integration with Ethereum-compatible wallet infrastructure for easy access

DeFi Participation

• Use USDP as collateral in decentralized finance protocols
• Trade USDP pairs on decentralized exchanges built on Ethereum
• Earn yield through liquidity provision on compatible protocols

Team and Background

Paxos is led by a team with extensive experience spanning:

• Traditional Finance: Expertise from Wall Street financial institutions
• Technology Innovation: Talent sourced from Silicon Valley tech companies

This combination provides both financial regulatory knowledge and blockchain development capability.

Summary

Paxos (USDP) represents a significant advancement in compliant stablecoin infrastructure, offering regulatory-approved alternatives to traditional fintech stablecoins. Key differentiators include:

Strengths:

• Full regulatory compliance from NYDFS
• 100% collateralization by FDIC-insured reserves
• Ethereum blockchain integration enabling broad ecosystem compatibility
• Trust company status providing enhanced custodial protections
• Open-source code promoting transparency

Considerations:

• Smaller market cap and trading volume compared to competing stablecoins
• Limited international regulatory approval outside US jurisdiction
• Ongoing evolution of global stablecoin regulations

Investment Thesis: USDP is best suited for investors and DeFi participants prioritizing regulatory compliance and custodial security over maximum ecosystem adoption. Its integration into Ethereum-based applications and direct redemption mechanism make it particularly valuable for risk-conscious institutional and retail participants.

Whether for DeFi participation, cross-border transactions, or compliant crypto asset trading, USDP offers a regulated alternative in the stablecoin landscape, backed by substantive collateral and regulatory oversight from established financial authorities.

FAQ

What is the meaning of USDP?

USDP is a stablecoin representing one US Dollar, pegged to maintain a 1:1 value with USD. It provides a stable medium of exchange and store of value within blockchain ecosystems, enabling seamless transactions and reducing volatility exposure.

What is USDP crypto?

USDP, or Pax Dollar, is a USD-backed stablecoin designed to provide stability in crypto markets. Each USDP token is fully reserved and audited, maintaining a 1:1 value with the US dollar to reduce volatility and ensure trust.

Is USDP safe to invest in?

USDP is safe for value preservation as a stablecoin backed by Paxos. It's ideal for beginners seeking stability, though it offers limited growth potential. Conduct your own research before investing.

How much is 1 USDP?

1 USDP equals approximately 0.9958 USD. As a stablecoin pegged to the US dollar, USDP maintains a value very close to 1 USD, with minimal fluctuation.