Crypto gold continues to establish itself as safe harbor during market turmoil
While the cryptocurrency market is experiencing another round of capitulation as part of the global correction, PAXG continues to show itself as a safe-haven instrument. Since the correction began in April, digital gold quotes have shown a cumulative gain of 140% against Bitcoin.
Many would argue that PAXG has also experienced a decline against the dollar, but comparing its performance to that of other coins, one would also note that the instrument has been trading steadily in a 10% corridor against the price at the beginning of April. Let’s be honest, such dynamics in the cryptocurrency market, where even stablecoins lose their peg to dollar and enter oblivion, can be considered optimal and safe enough.
How safe is the harbor?
The company behind PAXG, Paxos Trust Company, is a large crypto entity, which works closely with regulators, institutions and giants of the TradFi market, such as PayPal. It is also the issuer of BUSD and USDP, both widely used and traded at a premium to the rest of the market.
In 2021, Paxos received a conditional banking license from the U.S. Comptroller of the Currency (OCC), and in 2022, Forbes listed Paxos among the top 50 fintech companies, along with FTX, Circle and Chainalysis.
In addition, Paxos regularly publishes audit reports disclosing its crypto-gold collateral. According to the latest report dated May 31 this year, the outstanding 333,601,333 PAXG tokens are secured by 333,601,333 troy ounces of gold, and the tokens themselves are issued on the Ethereum network.