PAX Gold Price: PAXG Live Price Chart, Market Cap & News Today

what is pax gold

Paxos was one of the companies which digitized gold on the blockchain. Let’s see how they did it and how their Paxos Gold (PAXG) token functions as a blockchain asset. Pax Gold is now handled by over 50 vaults, exchanges, wallets, lending platforms and more. Because PAXG is backed by gold, it’s more stable and less prone to the short-term volatility of many other cryptocurrencies. This stability makes PAXG a great investment for crypto investors looking for a more secure investment with less risk — although it also has less upside. That means the price will always be identical or almost identical to the price of gold.

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In the official whitepaper, Pax Gold CEO Charles Cascarilla explains that the PAXG protocol is created entirely on the Ethereum blockchain and is secured by the proof-of-work (PoW) model. However, PAXG is not exclusively tied to Ethereum and can be launched on other blockchains as well. At the moment of writing, there are about 60,161 PAXG coins in circulation. However, the number of coins shifts almost by the minute as new investors are introduced, and Pax Gold increases the available gold supply for backing. After acquiring a degree in finance from the University of Notre Dame, he co-founded Cedar Hill Capital Partners in 2005. Since 2005, Mr. Cascarilla has participated in several traditional and blockchain-based venture capital projects.

Paxos Gold Review: Tokenized Gold Issued on Ethereum

  1. Paxos has created a variety of other crypto projects including PAX Dollar (USDP), a digital dollar and stablecoin.
  2. So far Paxos Gold is not in the list of supported coins, but Paxos founder and CEO Charles Cascarilla has hinted that PAXG could be supported in the future.
  3. PAX Gold works on the Ethereum network like any other token in ERC-20 protocol.
  4. Paxos adheres to strict compliance and regulatory practices — including monthly, quarterly, and annual audits to help ensure transparency of all asset amounts.
  5. When a customer trades for unallocated gold, they do not have actual ownership over specific gold bars; instead, they have a general entitlement to a certain quantity of gold that an institution promises to deliver.

PAX Gold, on the other hand, is a digital token that is actually backed by gold and provides investors with direct ownership of physical gold. To put it simply, Bitcoin’s relationship to gold is only an analogy, whereas PAX Gold’s relationship to gold is a direct representation. Through combining the security and liquidity offered by blockchain-based cryptocurrency, and the established name of gold as a physical commodity, Pax Gold brings a new investment opportunity to traders. PAXG has inspired other cryptocurrency developers to create gold-backed tokens as well. Pax Gold (PAXG) is a gold-backed cryptocurrency, launched by the creators of Paxos Standard (PAX) in September 2019. As an ERC-20 token operating on the Ethereum blockchain, Pax Gold is tradeable on a large variety of exchanges and has become an accessible way for traders to start investing in gold.

what is pax gold

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This can be done by sending the PAXG tokens to the issuer and requesting a redemption for the corresponding amount of physical gold. It is worth noting that the process of redeeming PAXG for physical gold may involve additional fees, such as shipping and handling charges, and may require compliance with certain regulations and procedures. Since the first records of the use of gold as an item with a linked value (such as coins, jewelry and valuable objects of art) gold has already had an appreciation of more than 300%. However, because it is expensive to own and store, gold is difficult to trade as a physical asset.

what is pax gold

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Pax gold (PAXG) is a popular solution for investors who want flexibility, trust, accessibility, and low fees for their gold ownership experience. These bars are securely stored in professional vaults, and anyone who owns PAXG has rights to a corresponding amount of the physical gold. Because PAXG is a direct representation of physical gold its value is also tied to the actual price of gold in real-time on the spot markets.

Once people become more comfortable using blockchain assets in general, it will be a logical leap for them to use digital gold rather than physical gold. After all, digital gold is far more portable, liquid, convenient, and it can even be used to generate interest payments. In an allocated account the firm you purchase the gold from will use your investment to buy and store physical gold.

In particular, PAXG was the asset that most contributed to the success of this particular type of stablecoins. Suffice it to say that Tether Gold, its main rival, only experienced modest growth. Gold meets some characteristics to be considered a good hedge fund asset.

Further, customers can exchange PAXG tokens into full-sized London Good Delivery gold bars on the website. Through a variety of partner gold retailers around the world, customers can also convert PAXG into smaller amounts of physical gold. The redeemability of the pax gold token involves its exchange for fiat money, physical gold, and unallocated gold. PAXG can also be traded for other cryptocurrencies on numerous crypto exchanges, providing high levels of accessibility for users worldwide. The process of redeeming PAXG for physical gold involves converting the digital token back into physical gold bullion.

In the beginning of November 2020, Paxos announced that they would be integrating with payments provider Paypal to offer cryptocurrency and cryptocurrency payments to the payment providers clients. So far Paxos Gold is not in the list of supported coins, but Paxos founder and CEO Charles Cascarilla has hinted that PAXG could be supported in the future. In addition, offers a debit card that can be loaded with U.S. dollars converted from the PAXG held with them. As of October 2023, users can deposit PAXG at Nexo and earn up to 7% APY.

Instead they can take advantage of the mobility and speed of transfer that comes with digital assets. Unlike the futures gold market, Paxos Gold join pro or pro plus and get lifetime access to our premium materials digital tokens carry no settlement risk. PAX Gold is a gold-backed cryptocurrency that provides investors with digital ownership over real gold.

The value of PAX Gold tracks with the real-time market price of gold. Unallocated gold is different in that the company you purchase the gold from doesn’t use your money to buy physical gold. Instead they often use the capital for other investments, but they do promise to deliver gold to you if you request that, or to return fiat currency to you when you’re ready to sell. Unallocated accounts are typically less expensive in terms of fees because they aren’t paying for the transport or storage of physical gold. The PAX Gold asset is fully regulated by the New York State Department of Financial Services (NYSDFS). Paxos designed its business model with an eye toward maximizing investor protections.