Tether and Circle are known for their stablecoin across multiple chains and they have not only covered the multi chain but also the multicurrency. Circle in fact has moved from USA to china and also recently got the license in the France.
There are other stablecoin companies too FDUSD, Paxos, BUSD and few others. But many of them are being shut down due to the regulation and the issues that come up remains is keeping up with the govt control over such stablecoin market.
Recently Paxos which is known to be the company behind the BUSD has now created their own stablecoin and has decided to issue outside the ethereum. Just like ethereum, they want to do with the Solana chain too.
Let's talk about how the multi chain blockchain stablecoin issuance works and how Paxos has managed to get new license for the same.
What is USDP of Paxos
Paxos was one of the company that allowed the issuance of the BUSD which was pegged to USD and also was assured through treasury for the backing. And this year the coin was turned into the dust after years of working. Meanwhile Paxos managed their own stablecoin and it was deployed on the ethereum based chain.
So the USDP was that USD coin pegged and developed by Paxos. And considering they got the license for issuance on the ethereum, they are now slowy decided to move past the other chain in order to become the multichain. So now they would be going into chains like say Solana, Avalanche, Polkadot and even other layer 1 chains there.
USDP on Solana Blockchain
Whenever any company wants to be a stablecoin issuer, they take the permission from the DFS office. DFS stands for Department of Financial Services (DFS). Each state in the US has this office. And those who are trying to be getting multi chain and multi currency suppport and wish to do business in the USA they are going to be getting approval on that.
USDP previously was only on the ethereum and now they are moving to the chains like Solana. And this means the DFS office giving them approval for the solana means they are going to be multi chain stablecoin issuer. And they are now free to extend to the Polkadot, Solana, Avalanche and others. Which is a good news for them in terms of extending portfolio.
Why Solana and not other Layer 1 chains?
As of now it seems most of the stablecoin issuers are deploying their stuff on the Solana. It seems like honeycomb like chian where a lot of people are doing things. And this means the chain is in demand so the Paxos, Tether and the Circle inc are already there. And having it deployed there is going to benefit them.
So why not other chains? I think Paxos just picked Solana out of priority and I am sure they are going to be expanding to other chains slowly. If everything works we can see them expanding on other chains they are now free to issue multichain stablecoins after all. Which means we will see them in ticker like that.
Paxos has moved away from the BUSD and now with the USDP they are also moving from Ethereum and now into Solana ecosystem. This would be a good decision for them both business wise and also in context of the adoption. Presence on more blockchain would only serve them in better light.