Paxos expands yield-bearing stablecoin USDL to Arbitrum

Paxos International has launched its yield-generating stablecoin Lift Dollar on the Ethereum layer-2 network Arbitrum.

UAE-based Paxos subsidiary, regulated by the Abu Dhabi Financial Services Regulatory Authority, announced the expansion of Lift Dollar (USDL) to Arbitrum (ARB) on October 9.

Paxos’ announcement comes just weeks after the company announced plans to bring its products to the Ethereum (ETH) layer 2 scaling solution.

What is the Rising Dollar?

USDL is a stablecoin pegged 1:1 to the US dollar and offers holders a return on their reserves (cash and cash equivalents). Lift Dollar uses an Ethereum smart contract to distribute its yield daily to eligible wallets without requiring owners to take any additional steps.

Because Lift Dollar is a regulated yield token, developers on the Arbitrum network now have another asset they can leverage to create and distribute new applications that support DeFi growth.

AJ Warner, chief strategy officer at Offchain Labs, stated that the addition of USDL is a boost to Arbitrum. Warner said the stablecoin enables cost-effective and fast transactions on the L2 network, with applications and use cases that will benefit from it, including gaming, social and decentralized finance.

These are ecosystems that are gaining increasing attention as the use of stablecoins expands globally. Paxos is one of the biggest players, along with Tether and Circle.

Paxos and Arbitrum partnership

In June 2024, Paxos International launched Lift Dollar with USDL distributed through partnerships with major crypto exchanges, wallets and trading platforms.

The company stated that while it allows exports to individuals and institutions, consumers in certain regions cannot benefit from this right. Such markets included the United States, the United Kingdom, Canada, Hong Kong and the European Union.

In September 2024, Paxos announced plans to integrate with Arbitrum. The partnership aimed to facilitate enterprise integration across the Arbitrum network, with Paxos helping to bring real-world assets to the platform through its regulated assets.

Paxos also issues other regulated digital assets, including Pax Dollar (USDP), PayPal USD (PYUSD), and Pax Gold (PAXG).