This is my submission for @yohan2on homework task which is about stablecoins. Today I'll try to write avoid PAX. In part one, i had written about Terher. Let's go;

Paxos Standard token (PAX) is an US dollar pegged stablecoin that matches ERC-20 standards and is tethered to USD in the ratio of 1:1. PAX was developed by Paxos Trust company to address the issue of price volatility of the cryptocoins while maintaining security standards of blockchain . An outstanding feature of the Paxos is that , it is approved and regulated by Finance Department of the New York. This approval has played a vital role in boosting the legal status of Paxos. Pegging of Paxos to USD means that for every Paxos Standard Toekn issued, one USD is reserved in the company's account. Similarly, on redemption paxos token is removed from the supply immediately. So mechanism of pegging is simple to understand here too like Tether. Being ERC-20 standard token, it runs smoothly on Ethereum wallet and Ethereum Exchanges.

As no middleman is involved in PAX issuance or redemption. PAX is issued directly by Paxos Trust Company. This approach of Paxos has two benefits, one is short redumption period and second is lower transaction fee.

As mentioned above, PAX follows ERC-20 protocol, it is widely accepted on most of the Ethereum wallets and exchamges and follow all the rules of smart contract based on ERC - 20 protocol . It helps PAX operate as programmed. So we can say PAX is programmable and stable digitalal asset. Ethereum blockchain makes it globally available. PAX is listed on more than 150 exchanges now.

Unlike traditional financial system, PAX is available for transactions anywhere and anytime. With the introduction of online banking in traditional finance, transactions have become global and available anytime on some modes but not for every mode of transaction like NEFT/IMPS/RTGS.These are yet to operate 24 x 7.

We know that PAX token is only created at the time of purchase and at the same time, for each PAX issued, one USD is kept reserve in banks. So 100% back up of PAX is created.

Being fiat pegged , it has a great potential of being used as storage asset as there is no fear of any wild devaluation and the same holds true for it being used as an exchange asset on day to day basis unlike other cryptos. The price volatility of the cryptocoins is a greatest hurdle for traders to accept them as exchange coin on routine basis.

It is something similar to centralized assets. On reception of any order by court / law and not by own will , paxos has ability to pause /freeze transfers/accounts and than unfreeze as and when needed. So this feature of Paxos is a step towards enhanced security.

PAX (Paxos standard) is a stablecoin tethered to USD in ratio of 1:1. USD is kept reserve on segregated accounts at FDIC-insured, U.S.-domiciled banks. It addresses issue of price volatility of cryptocoins and combines the price stability acquired therby to the security, transparency and accountability of Blockchain.