The international arm of New York-based Paxos will issue a U.S. dollar-pegged stablecoin that will not be available in the United States.

Paxos International's launch of the Lift Dollar (USDL) is a significant development in the stablecoin ecosystem, offering a regulated, interest-bearing stablecoin backed by liquid U.S. government securities and cash reserves. The decision to issue USDL in the Abu Dhabi Global Market (ADGM) under the supervision of the Financial Services Regulatory Authority adds a layer of regulatory oversight, enhancing trust and credibility in the stablecoin.

The mechanism of using rebasing in an Ethereum smart contract to automatically distribute yield based on market conditions is innovative and could provide stablecoin holders with a reliable source of passive income. Paxos International's claim that USDL is the first interest-bearing, regulated stablecoin underscores its pioneering nature in the industry.

The collaboration with distributors in Argentina further expands the reach of USDL, potentially offering users in the region access to a stable, interest-bearing digital asset. However, the restrictions on availability in certain jurisdictions, including the United States, highlight the complex regulatory landscape surrounding stablecoins and digital assets globally.

Paxos International's operations in the ADGM reflect the growing importance of the region as a hub for digital asset innovation and regulation. The ADGM's proactive approach to establishing DLT regulations and fostering partnerships with blockchain companies has attracted notable players in the industry, contributing to its rapid growth as a leading financial center.

Overall, the launch of USDL and Paxos International's expansion into the ADGM demonstrate the ongoing evolution and maturation of the stablecoin market, driven by a combination of regulatory compliance, technological innovation, and strategic partnerships.