Paxos CEO Charles Cascarilla wants his firm and its flagship $PAX stablecoin to lead the way for others to create new stablecoins, Cascarilla told The Block's Frank Chaparro in an interview on The Scoop podcast.
Paxos has opened up its stablecoin infrastructure to potential rivals, allowing them to develop their own stablecoins. The most recent example is Binance, which announced it would use Paxos as its custodian for its stablecoin offering $BUSD, pegged 1:1 with the U.S. dollar. A July partnership saw Stable Universal and Huobi begin to take advantage of Paxos' news services. On The Scoop, Cascarilla hinted at Binance, noting more partnerships would be announced in the near future.
“We’ll have some other examples shortly of firms taking advantage of that service,” he said.
At its core, Cascarilla said the firm is lending its trusted platform and regulatory seal of approval to others.
“That’s really us offering our trust as a service for other institutions in the space who aren’t regulated, to be able to build on both our technology and regulatory infrastructure in order to be able to offer very safe products for their customers,” said Cascarilla.
As for the benefits of stablecoins, Cascarilla says users aren’t subject to commercial bank risk. Per the Paxos CEO, only U.S. government credit risk remains on the table since PAX is pegged to cash held in FDIC insured accounts or treasury bills. Putting cash in the bank, on the other hand, subjects the money to bank hours, fees and restrictions, according to Cascarilla. Putting it on the blockchain makes it a 24/7 medium of exchange.
In addition to increasing the number of stablecoin offerings, Paxos is looking to make $PAX a viable alternative to traditional bank accounts. Cascarilla said it’s hard to open a consumer bank account today, contributing to a significant population of unbanked in the U.S. and up to 1.7 billion people worldwide.
The Paxos infrastructure makes it easier for some to obtain bank-like services by only requiring an Ethereum wallet to have the power of an account, with users able to store, send and receive money.
“You completely changed the access, you changed the dependencies in the system, you’re not reliant on certain institutions anymore,” Cascarilla said.