Paxos expands yield-bearing stablecoin USDL to Arbitrum

Paxos International has introduced its yield-bearing stablecoin, Lift Dollar (USDL), on the Ethereum layer-2 network Arbitrum. The launch was announced on October 9, and comes from Paxos’ UAE-based subsidiary, which is regulated by Abu Dhabi’s Financial Services Regulatory Authority.

What is Lift Dollar?

Lift Dollar is a stablecoin pegged 1:1 to the U.S. dollar, designed to provide yield from its reserves, which consist of cash and cash equivalents. Utilizing an Ethereum smart contract, USDL distributes yield to eligible wallets daily, requiring no extra action from holders.

The addition of USDL to Arbitrum enhances the ecosystem, providing developers with a new asset for building applications that support the growth of decentralized finance (DeFi). A.J. Warner, chief strategy officer at Offchain Labs, emphasized that USDL enables cost-effective and fast transactions across Arbitrum, with potential applications in gaming, social platforms, and DeFi.

Paxos and Arbitrum Partnership

Paxos first launched Lift Dollar in June 2024, distributing it through partnerships with various crypto exchanges and platforms. However, it specified that consumers in certain jurisdictions, including the U.S., U.K., Canada, Hong Kong, and the EU, are not eligible for issuance.

In September 2024, Paxos announced plans to integrate with Arbitrum, aiming to facilitate institutional adoption and help bring real-world assets onto the platform. Alongside USDL, Paxos issues several other regulated digital assets, such as Pax Dollar (USDP), PayPal USD (PYUSD), and Pax Gold (PAXG).