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Paxos expands yield-bearing stablecoin USDL to Arbitrum
Paxos International has launched its yield-bearing stablecoin Lift Dollar on Ethereum layer-2 network Arbitrum.
The UAE-based subsidiary of Paxos, regulated by Abu Dhabi’s Financial Services Regulatory Authority, announced the expansion of Lift Dollar (USDL) to Arbitrum (ARB) on Oct. 9.
Paxos’ announcement comes just a few weeks after the company revealed plans to bring its products to the Ethereum (ETH) layer 2 scaling solution.
What is Lift Dollar?
USDL is a stablecoin pegged 1:1 to the U.S. dollar and offers yield from its reserves — cash and cash equivalents — to its holders. Lift Dollar uses an Ethereum smart contract to distribute its yield to eligible wallets daily without holders needing to take any additional steps.
With Lift Dollar being a regulated yield-bearing token, developers on the Arbitrum network now have another asset they can tap into to build and deploy new applications that drive DeFi growth.
A.J. Warner, chief strategy officer at Offchain Labs, noted that the addition of USDL is a boost to Arbitrum. The stablecoin allows for cost-effective and fast transactions across the L2 network, Warner said, with applications and use cases that will benefit from this, including those across gaming, social, and decentralized finance.
These are ecos that are increasingly gaining greater traction amid the expansion of stablecoin use globally. Paxos is one of the major players alongside Tether and Circle.
Paxos and Arbitrum partnership
Paxos International launched Lift Dollar in June 2024, with USDL distributed via partnerships with major crypto exchanges, wallets and trading platforms.
While the company allowed issuance to individuals and institutions, it noted that consumers in certain jurisdictions were not eligible. Such markets included the United States, the United Kingdom, Canada, Hong Kong, and the European Union, among others.
In September 2024, Paxos announced plans to integrate with Arbitrum. The partnership aimed at facilitating institutional integration across the Arbitrum network, with Paxos helping to bring real-world assets onto the platform via its regulated assets.
Paxos issues several other regulated digital assets, including Pax Dollar (USDP), PayPal USD (PYUSD) and Pax Gold (PAXG).