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Paxos International has launched its yield-bearing stablecoin, Lift Dollar, on the 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 on Oct. 9. This announcement follows closely on the heels of Paxos’ plans to introduce its products to the Ethereum 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 utilizes an Ethereum smart contract to distribute its yield to eligible wallets daily, without requiring any additional steps from holders.
As a regulated yield-bearing token, Lift Dollar provides developers on the Arbitrum network with a new asset to build and deploy applications that drive DeFi growth. This addition is expected to enhance the capabilities of the Arbitrum network.
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, benefiting applications and use cases in gaming, social, and decentralized finance.
These ecosystems are increasingly gaining traction amidst the global expansion of stablecoin use. Paxos stands as a major player alongside Tether and Circle in this growing market.
Paxos and Arbitrum Partnership
Paxos International launched Lift Dollar in June 2024, distributing USDL through partnerships with major crypto exchanges, wallets, and trading platforms. While the company allowed issuance to individuals and institutions, it noted that consumers in specific jurisdictions, including the United States, the United Kingdom, Canada, Hong Kong, and the European Union, among others, were not eligible.
In September 2024, Paxos announced plans to integrate with Arbitrum. This partnership aimed to facilitate institutional integration across the Arbitrum network, with Paxos assisting in bringing real-world assets onto the platform via its regulated assets.
Paxos also issues several other regulated digital assets, including Pax Dollar (USDP), PayPal USD (PYUSD), and Pax Gold (PAXG).
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