New York Regulator signs off on two new stablecoins
New York regulator, Department of Financial Services [DFS] has given a go ahead to two new stablecoins, according to a press release issued by DFS. The two stablecoins approved are Gemini dollar and Paxos standard token. These two stablecoins belong to Gemini Trust Company LLC and Paxos Trust Company LLC respectively.
The stablecoins will be pegged to US dollar. “Every Paxos Standard token is fully backed by dollars held at U.S.-domiciled FDIC-insured banks,” said Charles Cascarilla , Paxos CEO. The Winklevoss twins have declared that the Gemini dollar will be a potential rival to the 8th largest coin Tether [USDT], a stablecoin pegged to the US dollar.
Approval has been granted to these stablecoins on strict conditions. The companies are supposed to ‘maintain robust policies and procedures to address risks and apply New York’s strong standards and regulations regarding anti-money laundering, anti-fraud, and consumer protection measures’.
“As the financial technology marketplace continues to evolve, New York is committed to fostering innovation while ensuring responsible growth. These approvals demonstrate that companies can create change and strong standards of compliance within a strong state regulatory framework that safeguards regulated entities and protects consumers,” said DFS Superintendent Maria Vullo.
“To date, there has been no trusted and regulated digital representation of the U.S. dollar on the blockchain. We are excited to bring the Gemini dollar to market, a stablecoin that combines the creditworthiness and price stability of the U.S. dollar with blockchain technology and the oversight of the NYDFS,” said Tyler Winklevoss during the launch of Gemini dollar.
“With Paxos Standard, we hope to enable a truly frictionless, global economy by offering a token that is stable, fast, redeemable, audited, and most importantly, approved and regulated. This is a digital asset that can be trusted,” commented Cascarilla on being granted the approval.
The approval for the new stablecoin applications were granted after a rigorous review of the applications. DFS has also mentioned that stringent requirements are placed on the companies and they will also be subject to inspections by DFS as well as independent consultants. Some of the regulations imposed on the companies include all the authorized stablecoins should be fully exchangeable for a dollar, complaint to cybersecurity regulations, maintain consumer protection and promptly address consumer complaints.
Image via Google
Join our Telegram group